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Land Sharks 

City speculators threaten to gobble up an immigrant's beloved piece of South Michigan Avenue

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By Ben Joravsky

To hear him tell the story, John Seo's been working around the clock for 20 years and saving every penny he's earned to buy a piece of the American dream.

And just as his dream was about to come true, just as he came tantalizingly close to possessing a prized piece of Michigan Avenue property, the city swooped in to snatch it away.

That's Seo's capsule version of the story--the city, not surprisingly, puts a different spin on the tale. Either way, strange things have been going on at the corner of Roosevelt Road and Michigan Avenue. "Why would they do this to me?" asks Seo. "How could this happen in America?"

To understand his frustration one has to realize how far he has come since he moved to Chicago in 1976 as a 25-year-old Korean immigrant who spoke little English. For a few months he lived with his parents, both garment workers, in an apartment at Saint Louis and Wilson in Albany Park. Then, not knowing what else to do, he joined the army.

"I wanted to be an American--what better way to be an American than join the army?" he says. "After I was inducted they put me up in a hotel on Michigan Avenue. I remember looking out my window and seeing Grant Park, the Field Museum, and the lake and thinking, 'This is it--this is America. I'm an American.' The next day I shipped out."

After a four-year stint he returned to Chicago, having saved enough money to buy a small grocery at Armitage and Pulaski in a working-class community. "I worked from early morning to night every day--I never took vacation," says Seo. "I wanted to save up enough money to buy my building. I tried to save everywhere. I wouldn't eat lunch. I wanted to save the money."

By 1983 he owned the building in which his grocery was situated, as well as the house in Wilmette where he lives with his wife and three children. In 1987 he sold the building on Armitage and bought the Econolodge Motel on Mannheim Road near O'Hare Airport. He renovated it and ran it profitably. One day last year he was approached by Gerry Lee, also a Korean immigrant.

"Gerry Lee owned the Avenue Motel at 1154 S. Michigan Ave. and he wanted help in renovating it," says Seo.

It was a 100-room motel built in a style better suited to Miami Beach than Chicago. Seo says Lee didn't have money to fix the motel, which was vacant, boarded up, and in wretched shape. Moreover, Lee had fallen behind on his taxes. "The city had taken him to demolition court," says Seo. "He was in danger of losing his property. I offered to buy it."

The pull, he says, was irresistible: the Avenue was where he'd stayed the night after his induction. "I looked out the window and saw the same sight I saw 21 years ago--the Field Museum, Grant Park, the lake--and I said, 'I want to own this. When I own this, I know I am really an American.'" He explains, "I want to run it as an affordable hotel. Maybe charge $90 a night. I figure it will be a success because there's a big need for affordable rooms downtown. Mostly they cost $200 to $300."

He hired a lawyer who ran a title search, and he pitched his plan to bankers, architects, and hotel chains. By spring he had the green light: LaSalle Bank had agreed to lend him $3.3 million, he had signed a franchise agreement with Comfort Inn, his lawyer had found no outstanding liens, his architect had designed a major renovation, he and Gerry Lee had signed a contract to purchase, and he'd sold the Econolodge. On April 27 he and Lee closed their deal, exactly one day before the Avenue was to be sold off as a tax-delinquent property.

"I had taken everything I owned and put it in the Avenue, but I didn't care," says Seo. "This was my dream and it was mine. My architect filed for a building permit. I was set to go. I hoped to be in business by [next] February."

But in June his architect got a call from the Department of Planning. "They said there was a problem and we'd have to meet," Seo says.

On June 10 Seo, his lawyer, and his architect trekked to City Hall, where they learned that the city had sent Gerry Lee a letter on April 2 informing him that "the Department of Planning and Development is seeking authority to acquire [your] property located within Near South Tax Increment Financing Redevelopment District. The City having the authority to acquire the property does not necessarily mean that the City intends to acquire it. It simply means the City may purchase the property at the fair market value."

In other words, the city was contemplating using its powers of eminent domain to seize the Avenue and sell it to someone else. "I told them I didn't want to sell, and they said that didn't matter," says Seo. "I asked them what plans they had for the site. They said they didn't know. I couldn't believe it. Why take a man's property away if you have no plans? OK, if you want to build a library. But they have no plans.

"I told them I didn't want to sell, and they said I had to because it was a run-down building. I showed them my lease agreement with Comfort Inn and my LaSalle loan and my building plans. I told them, 'I'm a new owner. It's not going to be a run-down eyesore anymore.' But they don't care. They showed me the letter they sent to Gerry Lee. I never saw it before. I asked Gerry Lee and he swears he never saw it either."

Twenty, ten, maybe even five years ago, the city might have welcomed an immigrant entrepreneur like Seo to that seedy block. But the real estate market has dramatically improved; in the city's eyes the block has become too hot for a relative upstart. As strange as it sounds, the city might have been better off had the property remained in Gerry Lee's hands. That way there would have been little resistance to buying it, and the asking price would have been much cheaper.

"In cases of eminent domain, the city has to offer a price for the highest and best use," says John Lee, Seo's lawyer (no relation to Gerry Lee). "The highest and best use is one thing for a vacant building. It's something else for a Comfort Inn. And that's what it will be if the city lets Seo do his thing."

In August Seo went to court to ask that the judge dismiss the demolition case. "I showed the building plans, the agreement with the Comfort Inn, and the loan agreement from LaSalle," says John Lee. "I told him the old demolition case no longer applies, because we have a new owner with money. To my surprise, the city opposed our request and asked for more time to respond."

So the case lingers while city lawyers write their arguments, and Seo can't get his building permit. "I think the city screwed up," says John Lee. "I think they never intended for the Avenue to fall into the hands of someone like Mr. Seo. But he somehow slipped under their radar, and now they're trying to kick him off of Michigan Avenue. Isn't that ironic? The city says they want to change the Avenue from being an eyesore, and yet they won't let Mr. Seo do just that. Their game is delay. They want to drag out the case until the bank and the Comfort Inn get tired and say, 'You're a good guy, Mr. Seo, but we can't fight City Hall.' My client will have to sell, and you watch--a few years later the city will quietly flip the property to one of their big-shot development buddies."

City officials vehemently deny John Lee's accusation. They say they have nothing against Seo and have no reason to doubt his ability to run a business. It's just that the site is now too valuable for a relatively low-rent hotel. Besides, Seo should have known better than to buy a piece of property slated for condemnation in a TIF zone.

"I can't stand it when people make baseless accusations that they can't back up," says Becky Carroll, a spokeswoman for the planning department. "They say we don't want Seo's business. They say we don't like entrepreneurs like him. They say we have the land reserved for big developers. That's so untrue. The fact is, we have no plans for the area, and we can't even make plans until we acquire the property. And we like entrepreneurs like Mr. Seo. We want to help them. They're good for the city. But this is an emerging site. This is a gateway for the museum campus. Whatever we put there should be very special. There was a motel there once before, and guess what? It didn't work. It became a vacant eyesore. How does Mr. Seo know it will work this time? Has he done a market study to show that there's a market for such a hotel? Listen, a hotel didn't work before, and every indication is that it won't work now."

Most city officials dismiss John Lee's accusations as the rhetoric of a lawyer trying to jack up his client's sale price. But Seo says he has no intention of selling. "The city doesn't want my client here, but he's there and he intends to stay," John Lee says. "He doesn't want the city's money. He wants in on Michigan Avenue. They might not have invited him to Michigan Avenue, but he's there whether they want him there or not." o

Art accompanying story in printed newspaper (not available in this archive): John Seo photo by Dan Machnik.

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