Where in the real world does somebody buy a chunk of land for one price and sell it for four times that much just 14 months later?
That would be Sweet Home Chicago, still the “city on the make,” especially when it comes to government deals that suck up your taxpayer dollars.
Sorry if we sound cynical, but a story in Sunday’s Sun-Times by reporter Tim Novak, about how land west of McCormick Place was assembled for a new basketball arena and hotel, should have Chicago taxpayers clutching their wallets.
Novak reports that a politically connected law firm, Neal & Leroy, was uncomfortably close to both sides in the particularly questionable transaction, which should not happen. The government agency involved did not bother to get the land appraised, which it should have. And basic documents that could explain how this was allowed to happen are being kept secret, supposedly to protect attorney-client privilege, which is nonsense.
Once again in Chicago, local government appears to have favored a powerful political insider in doing business, ethical niceties brushed aside, to the detriment of all those stuck on the outside and the general public.
The land in question is 21,857 square feet of weeds on the northeast corner of 21st and Prairie that an Australian developer, Drapac Group LLC, bought for $1,020,000 in May 2013. Drapac’s registered local lobbyist at the time was Langdon D. Neal, of Neal & Leroy.
Fourteen months later, Neal’s firm turned around and helped another client, the Metropolitan Pier and Exposition Authority — McPier — buy the land. McPier paid $5,473,750, meaning Neal was instrumental in his old client getting a 400 percent profit from his new client.
We would sure like to know who at McPier knew that their guy on this deal, Neal, had worked for the other side, Drapac, just months earlier. Did Neal inform McPier of the possible conflict of interest, as he says he did, and get a waiver? If so, who approved it? Did the board of directors have a clue?
This should all be a matter of public record. McPier is a public agency spending taxpayer money for, supposedly, the public good. But McPier officials, no doubt upon some cautious lawyer’s advice, won’t release the documents.
And who might that cautious lawyer be?
Quite possibly — and this is getting surreal — Neal himself. Under his contract with McPier, he also advises the agency on how to handle public records.
Langdon Neal is one of the most connected lawyers in Chicago. He wears many hats and routinely gets a piece of the biggest real estate deals in town. His law firm does plenty of work for local government at all levels, but also for clients trying to get something from those governments. He works it both ways. He is chairman of the Chicago Board of Elections, general counsel to the city’s Public Building Commission, and of counsel to McPier.
For decades, Neal and his law firm, which was founded by his grandfather, have been favored by local government when it comes to using eminent domain law to acquire land. His defenders say he does a great job of getting the lowest possible price, and few other minority-owned law firms specialize in such work.
But when McPier awards a seller a 400 percent profit, without even first getting an appraisal of the land, it’s hard to believe the agency drove a hard bargain. And this sort of law work, we are told, is usually fairly routine. Plenty of law firms — including many other minority-owned firms — can handle it. There is no justification for not spreading the work around, creating more healthy competition.
McPier has spent nearly $62 million acquiring land for the hotel and arena, using taxpayer-funded bonds and $25.9 million in city property taxes.
Like a construction zone sign, we’d love to say “Your taxpayer dollars at work!”
But we’re not at all sure.
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