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City Seeks Developer for Vacant Former Lerner Site on Howard Street

By Benjamin Woodard | October 8, 2013 8:59am
 Ald. Joe Moore hopes to find a buyer to build a commercial and market-rate residential development.
Ald. Joe Moore hopes to find a buyer to build a commercial and market-rate residential development.
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DNAinfo/Benjamin Woodard

ROGERS PARK — The vacant lot with a storied past at Howard Street and Ashland Avenue could finally be redeveloped after the city issues a request for proposals "in the near future," officials said.

The lot, formerly the site of Lerner Newspapers' printing operations, has sat empty for years as tumultuous ownership and environmental contamination marred the property.

Now that the city has owned the property since December 2012, it's looking for a developer to build a mixed-use structure that would include retail, commercial and residential spaces.

"It would change everything," said real estate broker Rich Aronson, who has a Howard Street office next door to the lot. "I call this the jewel on the Far North Side of the city."

Aronson said a high-rise development with 300 mixed-income units would have a "ripple effect" on a downtrodden Howard Street and the rest of Rogers Park.

The City Council is expected to approve a zoning change next week that would allow a higher-density development. Then — "in the near future," said Ald. Joe Moore (49th) — the city plans to issue a request for proposals for the lot.

The city tried to find a developer through an attempted eminent domain acquisition before — in 2006 — and no one showed interest, Moore said.

"I believe the market is better now than it was in 2006, but it may not be ready to support the kind of development that the neighborhood would want to see," he said.

While the city shops for a developer, Moore said the lot would be set aside for a community-focused use, which he plans to announce by the end of the month.

Before the city bought the property for $900,000, using some tax increment financing money, the 1-acre parcel was acquired in 1992 by the same development team that built the Gateway Centre shopping plaza at Clark and Howard streets.

One of the partners was John Terzakis of the Burrell Restaurant Corp., which retained ownership of the property until a foreclosure in 2010.

Terzakis had planned to develop a mixed-use retail, condominium and town home development on the property. But he was later convicted for his role in a $25 million Ponzi scheme, according to media reports, and the development plan fizzled along with his company and the nation's real estate market.

Since then, neighbors have attempted to band together to launch an urban farming incubator at the site. But complicating any type of development, the Illinois Environmental Protection Agency forced a cleanup of the property due to environmental hazards after the demolition of Lerner's building.

The site was fully cleared of environmental hazards in October 2012, according to agency documents.

Now the only thing the city needs is an interested developer.

Although some affordable housing would be "part of the mix," Moore said, the development should consist mostly of market-rate units.

"The goal is to bring more people in the area with disposable income who would help spur economic development on the Howard commercial strip," he said.

Michael Luckenbach, a longtime real estate broker who has lived north of Howard Street since 1975, agrees.

"That needs to be developed," said Luckenbach, 70, who said he remembers a time when Howard Street was a vibrant commercial strip. "That’s too prime an area."

Even though there have been modest investments in the area, Luckenbach said the right kind of development on the property could be just what Howard needs.

"Man," he said, "what a boost that would be for the area."