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6401-25 N. Rockwell St. – Rockwell-Devon Redevelopment

Update 12/4/2009: Homeowners lose appeal in fight to stop parking garage
In an opinion dated November 25, 2009, but not yet filed or posted online, the Illinois Appellate Court has upheld an earlier Circuit Court decision dismissing the homeowners' lawsuit against developer Mohammed Siddiqi. The homeowners' lawsuit, originally filed October 24, 2007, sought a permanent injunction against the developer to enforce restrictive covenants prohibiting commercial structures north of the alley and requiring that any building be set back twenty feet from the property line. The project now under construction is more than two thirds commercial and extends beyond the property line to overhang the public sidewalk.

Neither the Circuit Court nor the Appellate Court disputed the existence or validity of the covenants. Both decisions were instead based on the homeowners' alleged failure to prove the obvious—that the proposed project would in fact violate the covenants. The homeowners contend that 1) they were not required to prove precisely how the project would violate the covenants and 2) that they proved it anyway. The trial court's ruling is clearly contrary to the manifest weight of the evidence and should have been reversed. A further appeal to the Illinois Supreme Court is possible, but that decision has not yet been made.

The trial court's decision in dismissing the case ignored the plain language of the covenants and the basic facts of the proposed project. The covenants prohibit commercial structures; the project is a mixed-use, predominantly commercial structure; therefore, the project violates the covenants. The full text of the covenants states that "[a]ll conveyances of property in this subdivision are made subject to the following provisions: All lots fronting N. Rockwell St., N. Maplewood Ave., N. Campbell Ave. and N. Artesian Ave. shall have a building line of twenty (20) feet as indicated on the above plat; except that bay windows may project five (5) feet and open front porches ten (10) feet beyond said building line. All buildings shall front with the lots as platted. Only residences and flat buildings costing not less than three thousand (3000) dollars shall be placed on lots fronting N. Rockwell St., N, Maplewood Ave., K Campbell Ave. and N. Artesian Ave. Only buildings wholly or in part for business purposes not less than two (2) full stories in height and constructed of brick, stone or concrete shall be erected on Devon Ave. and N. Western Ave."

The Appellate Court reiterates in its opinion that "[t]he record is clear that defendants' project consists of a planned unit development including a mixed use building with commercial and retail spaces on the first floor, single-family residential condominiums and parking." What is there left to prove?

Update 11/15/2009: $11.2 million in bad debt dogs developer
The great mystery of the Rockwell-Devon redevelopment project is how developer Mohammed Siddiqi has been able to continue work despite his massive mounting debt. To date, five separate lawsuits have resulted in $8.6 million in judgments against Siddiqi. Another dozen totaling $2.6 million are pending. In addition, ASAT Inc. and Homes 4 You Inc., the two corporate entities under which he does business, have been involuntarily dissolved by the Secretary of State.

The Judgments entered to date include:

Case 2008-L-050556, State Bank Countryside v. Mohammad Siddiqi
Judgment for Plaintiff in the amount of $479,849.00 entered May 30, 2008.

Case 2008-L-011597, Bridgeview Bank v. Mohammed Siddiqui
Judgment for Plaintiff in the amount of $2,984,936.00 entered June 11, 2009.

Case 2009-L-051161, Republic Bank v. Mohammed T. Siddiqui
Judgment for Plaintiff in the amount of $3,283,580.00 entered September 17, 2009.

Case 2009-L-051162, Republic Bank v. Mohammed T. Siddiqui
Judgment for Plaintiff in the amount of $920,515.00 entered September 22, 2009.

Case 2009-L-051163, Republic Bank v. Mohammed T. Siddiqui
Judgment for Plaintiff in the amount of $920,515.00 entered September 22, 2009.

Of the $2.6 million pending, only one directly affects the Rockwell property. The remaining claims are against Siddiqi's other properties and failed developments, including 3339 W. Argyle, 5601 N. Clark, 4412 S. Indiana, 2140 W. Devon, 2740 W. Pratt, 2115 W. Roscoe, 6917 N. Western and 4646 N. Winthrop.

Update 7/14/2009: Yet another construction delay
Construction has once again come to a halt at Rockwell and Devon. The job site has been quiet for several days and will likely remain that way for at least another week. Word on the street is that developer Siddiqi failed to pay his contractor who pulled off the job as a result. It appears that a change of contractors is in the works. The new contractor is still estimating the cost of the job and does not yet have a contract. Once he's able to get to work, his first job will be cleaning up the mess left by his predecessor, including poor quality workmanship that will need to be corrected.

Ald. Stone insisted until recently that the parking garage would be ready to open in late June (that's right—last month). He's now talking about next spring (perhaps another nine months). The alderman blames ongoing litigation for delaying the project by "at least a year." However, with the exception of a four-month temporary injunction (March-June 2008), Siddiqi has been free to work without interference. Still, progress has remained slow and the project is now nearly two years behind schedule. This latest delay is simply confirmation of Siddiqi's lack of qualifications and his inability to deliver.

Meanwhile, the final brief in the homeowners' appeal was filed earlier this week. The appeals court is likely to take another three or four months to reach a decision, which probably means no news until the end of November.

Update 7/7/2009: Developer Siddiqi not in compliance with agreement
Two years after entering into a redevelopment agreement with the City of Chicago, developer Mohammed Siddiqi has yet to file a single required progress report or financial statement. The City's Department of Community Development (DCD) is responsible for monitoring compliance, but has so far failed to do so. In response to outside pressure, DCD is finally starting to pay attention.

DCD held a Compliance Information Conference with Siddiqi On March 23 to explain applicable compliance requirements for the Rockwell project. Three weeks later, on April 9, DCD conducted a so-called Pre-Construction Conference with Siddiqi and his general contractors, Neil Mudigonda of Sree Construction and Dan DaValle of Crown Construction. Sree Construction is the general contractor of record, although Crown Construction appears to be the actual general contractor. I say "so-called" Pre-Construction Conference, because the meeting took place nearly 26 months after Siddiqi received a building permit, 23 months after execution of the redevelopment agreement and nine months after the actual start of construction. As of last week, Siddiqi had still not filed any required documentation. In a letter dated June 8, DCD reminded Siddiqi that "Continued noncompliance can result in sanctions against the project, the developer, the general contractor, and/or affected subcontractors."

Update 3/28/2009: Siddiqi in labor dispute with carpenters union
Carpenters Local 58 is currently engaged in a labor dispute with developer Mohammed Siddiqi over the payment of sub-standard wages to Rockwell-Devon construction workers. Under his redevelopment agreement with the City of Chicago, Siddiqi is required to pay prevailing wage and meet city targets for hiring minority and women owned-businesses and city residents. Nearly two years into the agreement, Siddiqi has so far failed to meet any of his obligations or file a single compliance report. Despite complaints to the Department of Community Development's compliance division, the City continues its negligence in enforcing the agreement.

Members of Carpenters Local 58 have been picketing the Rockwell-Devon construction site and distributing flyers questioning taxpayer subsidies and support for the project by local politicians in return for "a few well placed political donations".

Update 3/15/2009: Developer Siddiqi's financial situation worsens
Bridgeview Bank is suing developer Mohammed Siddiqi for breach of contract due to Siddiqi's failure to pay four promissory notes totalling $2.7 million. The notes are for mortgages and construction loans for Siddiqi-owned properties at 2740 W. Pratt, 2115 W. Roscoe, 4635 N. Broadway and 2140-50 W. Devon. Bridgeview Bank has also filed for foreclosure against the Pratt and Roscoe properties.

Siddiqi's financial troubles don't end with Bridgeview Bank. State Bank of Countryside is seeking to foreclose on two units in Siddiqi's unfinished 4646-50 N. Winthrop development. The foreclosure is a result of Siddiqi's failure to pay the remaining $410,000 balance due on his construction loan. Late fees and interest continue to accrue.

Update 2/28/2009: Siddiqi mortgages Rockwell-Devon to appease Broadway Bank
Even politically connected developer Mohammed Siddiqi is suffering from the current recession. Bridgeview Bank has foreclosed on two Siddiqi mortgages totaling $781,000 and various lenders have filed foreclosures against at least fifteen apparently fraudulent mortgages at other Siddiqi developments. In a surprising new development, Siddiqi has mortgaged the Rockwell-Devon project as additional collateral to secure two otherwise unrelated loans from Broadway Bank.

The two "Subordinate Mortgage and Security Agreements" were executed December 19, 2008 and recorded February 5, 2009. The first agreement provides Broadway Bank with additional security for Siddiqi's $1,376,018 mortgage dated April 27, 2005 for the property at 4635 N. Broadway. The due date of the original loan has been extended until June 19, 2010. The second agreement secures Siddiqi's $4,525,000 mortgage dated March 26, 2006 for the property at 5601 N. Clark. The due date for this loan has been extended until December 19, 2010. Both agreements clearly state that "Mortgagee [Broadway Bank] would not lend to the Borrower [Siddiqi] without the additional collateral provided by Mortgagor herein."

Allowing these additional liens against the property is a violation of Siddiqi's redevelopment agreement with the City of Chicago. The City has so far been completely negligent in administering the agreement so it is not clear whether it will take any action against Siddiqi for this latest violation.

Update 2/6/2009: Lawsuit continues with appeal
Don't believe everything you hear, especially if you hear it from Alderman Bernie Stone, who would like you to believe that plaintiffs in the lawsuit opposing to the Rockwell-Devon parking garage have "given up the ghost" after not being able to post the $5 million bond required for a stay pending appeal. Plaintiffs' failure to post bond allows construction to proceed during the appeal, but in no way affects the ultimate outcome. Unfortunately, the machinery of justice moves slowly and no decision is expected until June or July. Meanwhile, Siddiqi continues to work at his own risk knowing that Judge Martin's July 2008 ruling may yet be overturned.

Update 10/31/2008: Construction continues while Plaintiffs await appeal
A decision on the appeal of Judge Martin's dismissal is not expected until February. Meanwhile, construction continues sporadically. The building permit was issued 21 months ago, but Mr. Siddiqi still isn't ready to dig a hole. If this is how he works through the Spring, Summer and Fall, don't expect to see much activity during the winter months.

Update 7/2/2008: Lawsuit dismissed – Plaintiffs to file appeal
In what I can only describe as a completely baffling decision, Judge Martin yesterday dismissed our lawsuit against Mohammed Siddiqi and the planned Rockwell-Devon parking garage. We will be filing a notice of appeal today. An appeal will likely take another three to four months.

What is so baffling about yesterday's ruling is Judge Martin's explanation for his decision. He agreed with us that the covenants exist, that they are enforceable, and that they apply to that part of development site north of the alley. But, he said, we had not demonstrated that the proposed project would violate the covenants. Judge Martin ruled that we had not shown that the proposed commercial uses would be located on lots subject to the residential use restriction.

While even the most basic description of the project and the defendants' own admissions should have made this unmistakably clear, Judge Martin seemed to base his decision on the lack of architectural floor plans as evidence. We had, in fact, attempted to introduce construction plans into evidence, but Judge Martin sustained defense counsel's objection and prohibited them.

This is an extremely disappointing ruling; however, I am confident that we will ultimately succeed in putting an end to this disastrous project that threatens our neighborhood and the future of Devon Avenue. I had hoped we would finally be able to put this mess behind us and start working to repair the damage already done. Instead, we must keep up the fight for a few more months.

Update 6/26/2008: Plaintiffs present their case at trial
Judge Martin had originally scheduled only three days, but the trial will now continue into next week. Numerous and repeated objections from defendants' counsel slowed the trial to a crawl and tested Judge Martin's patience. At one point Wednesday the judge left the courtroom for a sidebar with attorneys from both sides and apparently instructed them to resolve their disputes over evidence before the trial would resume. The five attorneys met together in the courtroom across the hall for half an hour or more before returning to Judge Martin's courtroom to resume the interrupted testimony of plaintiffs' witness.

At the end of the day Wednesday, after having presented ten witnesses over three days, plaintiffs rested their case. The trial will resume Tuesday, July 1 at 2:00 pm with defendants presenting their side of the story. Although the trial should conclude next week, no decision in the case is expected until after the Independence Day holiday.

Update 5/18/2008: Plaintiffs file for summary judgment. New trial date set
Judge Martin has pushed back the previously scheduled trial date in order to allow time to hear Plaintiffs' motion for summary judgment. A hearing on the motion has been scheduled for Thursday, June 19. If Judge Martin finds that there are issues of material fact that remain to be decided, then the case will go to trial starting Monday, June 23.

Update 4/27/2008: Judge sets trial date
Cook County judge Leroy Martin Jr. has set May 28, 2008, as the date for a hearing on a permanent injunction. The hearing is expected to take at least three days. Meanwhile, the preliminary injunction is still in force, preventing developer Mohammed Siddiqi from starting construction on the planned parking garage and condominium development.

Update 2/29/2008: Court order stalls parking garage
Cook County judge Leroy Martin Jr. has issued an order for preliminary injunction against developer Mohammed Siddiqi preventing him from starting construction on a planned parking garage and condominium development at the corner of Rockwell St. and Devon Ave. in West Rogers Park. Today�s court order is the latest in a series of setbacks for the controversial project and a significant victory for homeowners who filed suit in October to block the development. Today�s ruling means that no construction may begin before a final decision in the case. The developer agreed to accept a preliminary injunction after homeowners filed an appeal of Judge Martin�s earlier ruling denying the injunction.

Update 1/13/2008: Judge denies motion for preliminary injunction
Judge Leroy Martin Jr. has denied a motion for a preliminary injunction to prevent developer Mohammed Siddiqi from starting construction prior to a final decision in the lawsuit. A preliminary injunction is a strong measure that judges are typically reluctant to grant when issues of fact are in dispute. The case now proceeds to the next stage which will most likely include both sides presenting evidence in a detailed examination of the facts.

Update 11/15/2007: Developer agrees construction can wait until hearing
Attorneys for developer Mohammed Siddiqi headed off a hearing on a temporary restraining order by filing their answer to the homeowners' complaint the day before the scheduled hearing. The court will instead hear plaintiffs' motion for a preliminary injunction December 17, 2007. Siddiqi has agreed not to start construction prior to the December hearing.

Update 10/31/2007: Dave Roeder's column in the Sun-Times:
David Roeder, Chicago Sun-Times

IN DEED: The aldermanic elections are a fading memory, but Ald. Bernard Stone (50th) and a former challenger the last time around, architect Greg Brewer, continue to battle over a six-story condo building and parking garage planned for the northeast corner of Devon and Rockwell. Brewer's group, Citizens for Responsible Development, has sued to block construction on the surprising grounds that the project violates 1913 deed restrictions that apply to the property and adjacent side streets.

Brewer said the restrictions allow only for residential use and require a 20-foot setback for anything that gets built. The new building is a violation on both counts, said Brewer, who has contended it is way out of scale for the area. The parking lot floors would extend over the sidewalk.

Stone countered that the restrictions haven't been enforced. He said the developer, Mohamaad Siddiqi, has overcome delays caused by the city and that site work has begun. "He's put up $270,000 to move utility poles. You think he's going to stop now?" Stone said.

Update 10/25/2007: Suit filed to block parking garage-condo complex
Tribune staff report, Chicago Tribune

CHICAGO - A group of West Ridge residents filed a lawsuit Wednesday in hopes of stopping the construction of a controversial parking garage and condominium development along Devon Avenue's South Asian shopping corridor.

Supporters of the project, such as Ald. Bernard Stone (50th), say the six-story parking garage-condo complex at Rockwell Street and Devon Avenue would ease the parking crunch along one of the city's busiest shopping destinations.

But in the Feb. 27 aldermanic race, Stone's three challengers criticized the project, which was being financed partially with more than $4 million in city support. One of the challengers, Greg Bower, said the plaintiffs in the lawsuit, which was filed in Cook County Circuit Court, include 10 homeowners living in an area who believe the project violates restrictive covenants dating back to 1913 that were established to protect the residential character of the neighborhood.

The $16 million project has stalled and construction has yet to begin.

Update 10/24/2007: Neighbors sue developer to stop parking garage
A group of West Rogers Park homeowners today filed suit against developer Mohammed Siddiqi in an effort to stop construction of a planned parking garage and condominium development at Rockwell Street and Devon Avenue on the city�s far north side.

Homeowners allege the planned six-story mixed-use structure would violate restrictive covenants established to protect the residential character of their neighborhood. Deed restrictions recorded in 1913 permit only residential development on Rockwell and adjacent side streets. Deed restrictions also require that all buildings be set back at least twenty feet from the property line.

The proposed development includes ground floor retail and office space, a multi-level public parking garage and 30 condominium units. Parking garage floors would extend beyond the property line to overhang the sidewalk. The lawsuit filed today in Cook County seeks to enforce the restrictive covenants through a permanent injunction against the project.

Homeowner Mary Freely has lived in the neighborhood for 32 years. The two-flat she shares with her son and daughter-in-law sits directly across the alley from the development site.

�I�m afraid we�ll never see the sun again; we�ll be living in the shadow of a parking garage,� Mrs. Freely said.

Today�s lawsuit is the latest in a series of setbacks for the controversial project. The development has the support of local alderman Bernie Stone (50th Ward) and is slated to receive $3.6 million in TIF funding, but is more than a year behind schedule and remains stalled. The building permit issued in January has expired due to Siddiqi�s continued delay in starting construction.

Neighbors have objected without success to a series of zoning changes and other city approvals. Many believe the design is grossly out of scale with its surroundings and will overwhelm the residential neighborhood of historic bungalows and two-flats.

�The city�s planned development process has been used to disregard normal zoning requirements and allow a combination of height, bulk, and density not permitted anywhere else in the 50th Ward,� said Greg Brewer, an architect and community activist.

Prior city approvals have no bearing on the homeowners� lawsuit. The city does not review or enforce deed restrictions, which are considered to be private agreements. The developer is fully aware of the restrictive covenants but has chosen to ignore them.

Brewer encouraged homeowners to bring their case to court and helped organize the lawsuit.

�The city can ignore its own rules and regulations, but it cannot violate the right of homeowners to protect the value of their property,� Brewer said.

Update 7/18/2007: Back to the Drawing Board
Despite Alderman Stone's continuing claims that construction is going to start "in a few days", Mohammed Siddiqi's Rockwell-Devon redevelopment project continues to face problems and delays. In January my aldermanic campaign issued a press release explaining that the design of the parking garage was unsafe. I followed up with letters to the Executive Director and Deputy Director of the Department of Construction and Permits (DCAP). Now, six months later, Siddiqi has finally applied to change the design by adding another stairway for the parking garage. I don't know if this will solve the problem, but I haven't been able to see the drawings yet. (DCAP has denied my FOIA request to review the drawings. I am appealing the decision.) Even if the new stair does solve the egress problem, it can't solve the accessibility issues. The Mayor's Office for People with Disabilities (MOPD) has yet to approve the design changes. – Greg Brewer

Description
The proposed Rockwell-Devon Redevelopment Project is to be located at the northeast corner of Rockwell Street and Devon Avenue. The six-story building is planned to include parking, retail, office space, and thirty residential condominiums. The development site includes two city-owned parking lots and a two-story four-flat, which would be demolished. The City and the developer plan to close the 6400 block of Rockwell with a cul-de-sac and eliminate the public alley north of Devon.

Most of the first floor would be taken up by parking ramps. The garage entry is to be located on the Rockwell side of the building close to the Rockwell-Devon intersection. The fist floor also includes limited retail and office space. The second, third and fourth floors are planned as public parking. These floors are planned to overhang the Rockwell sidewalk by about five feet. Condominiums would be located on the fifth and sixth floors. Condo parking is planned for the basement level and would be entered from the alley.

The proposed project is an insult to the community. It is poorly planned, grossly out of scale with its surroundings, incompatible with its residential neighborhood, detrimental to the unique character of Devon Avenue, and an irresponsible use of public resources for private development with no community involvement or public benefit.

The only justification for this project has been parking, but the parking layout is barely functional and will not provide the number of spaces promised. Alderman Stone testified to the Chicago Plan Commission that the proposed development would result in a net gain of 200 parking spaces. More recent documents promise only 133 new spaces. Judging from preliminary plans, it will be difficult to achieve even 60 new spaces--less than one third Alderman Stone's original promise.

These 60 spaces will cost Chicago taxpayers $4.5 million--about four times the normal cost of parking. This cost includes giving away city-owned property valued at nearly a million dollars and $3.6 million in real estate tax revenue from the Devon-Western TIF district--funds intended for business district improvements. We support local businesses in their efforts to provide additional parking for Devon Avenue shoppers, but this project is not the answer. Any gain in parking would be insignificant compared with the impact of this massive structure on our neighborhood. More efficient and less costly alternatives are available.

Plans to close Rockwell with a cul-de-sac and vacate the public alley north of Devon will result in reduced access for businesses, residents, city services and emergency vehicles. Locating the parking garage entry and exit drive at the Rockwell-Devon intersection will be disruptive to traffic and hazardous to pedestrians.

This project has been misrepresented from the start. The project as designed fails to comply with numerous zoning regulations and guidelines. The planned development process has been used to disregard normal zoning requirements and allow a combination of excessive height, bulk, and density not permitted anywhere else in the entire 50th ward. Alderman Stone personally sponsored these zoning changes, but has never presented the project to the community. Local property owners did not receive even the minimum notice required by law.

The planned development also violates enforceable deed restrictions requiring buildings be set back twenty feet along Rockwell and permitting only residential uses north of the alley.