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Edgewater Medical Center Redevelopment Plan Hits Snag, Could Be Scaled Back

By Benjamin Woodard | January 23, 2014 6:40am
 The vacant Edgewater Medical Center, an "eyesore" in the neighborhood for years, could be redeveloped under a proposal put together by the alderman's office and the managers of the bankrupt estate.
Edgewater Medical Center
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EDGEWATER — The grand plan to redevelop the vacant and deteriorating Edgewater Medical Center into 19 single-family homes, a 12-story apartment building and a park could be scaled back after efforts to find a developer to finance the project have failed, officials said.

"It’s been a slow process and frustrating from everyone's perspective," said Chenin Kienzler, an attorney and aide to Ald. Pat O'Connor (40th), who was familiar with the project's negotiations. "They thought they’d be able to sell this. It just never worked out in the end, in terms of getting a done deal."

The site, at 5700 N. Ashland Ave., has been vacant since 2001 after former owner Peter Rogan went bankrupt and was eventually indicted for allegedly not paying a court-ordered judgment of $188 million to creditors.

Since 2009, O'Connor and Waveland Partners — which was hired by the estate's owner, European creditor Dexia — have worked to market a redevelopment of the property.

O'Connor told dozens of community members in February that Waveland and his office had decided on an extensive planned development that included the apartment building with street-level retail, 19 single-family homes along Edgewater Avenue and a large park, to be managed by either a neighborhood association or the Chicago Park District.

But that plan might never come to fruition as O'Connor has asked an influential group, West Edgewater Area Residents Association, for their opinion on a "Plan B," according to language distributed with a seven-question survey this week.

The plan appears to be a proposal to construct 41 single-family homes across the entire space, with a smaller park the size of four home-sized lots.

Scott Mendeloff, an attorney for the estate, wouldn't confirm or deny Wednesday the new plan or comment on recent negotiations with possible developers.

"That’s very confidential and private," he said. "There are a wide variety of opinions on how this property should be used — there always had been. ... This has been going on a long time and we’re moving toward a resolution."

Some community members say Dexia and Waveland have taken too long to sell the land and haven't paid enough attention to what the community wants.

"This thing has been sitting empty for 10-plus years," said resident Andrew Strand, who owns a home a couple of blocks north of the site. "It has a significant impact on the local economy and the city economy. It has depressed property values in the area here."

Strand said he was worried future development proposals might not include plans for any park space at all.

He said he found that possibility to be absurd knowing that Dexia allegedly owes $320,000 in unpaid water and sewer bills and $13.7 million in county property taxes from the years 2002 to 2011, according to documents filed in July with a proposed city ordinance and zoning change that would have allowed for the larger development.

Even though Dexia denies it owes the debt, the creditor is also seeking tax increment financing, paid for by nearby property owners, to help fund the demolition of the center.

And all that public help should be reciprocated, Strand said.

"Clearly this has been a problem," he said, "and why hasn't it been solved? Why should they be allowed to hold the city and the neighborhood hostage? Just because they have title to that property doesn't mean they have a blank check."

Christopher Swan, the president of the area's neighborhood association, said the larger development plan "is dead," which might be a good thing after all.

"Everyone in our community would prefer single-family homes," Swan said, and some would "accept a little less park space" to make it happen.

Kienzler, the attorney working with the alderman's office, said a few developers have expressed an interest in building single-family homes, but none of them have come to a price point at which Waveland would begin negotiations.

Only once before has a contract for the deal gone before a judge, she said, but it never became a reality.

"The money wasn’t ever really there," she said. "That was disappointing."