Sykes owners file lawsuit against city, Scott Goodman

Longtime Chicago developer Scott Goodman and Mayor Lori Lightfoot’s administration is facing a lawsuit, alleging that they sabotaged a sale for land next to the Bronzeville Lakefront property set to go under a $3.8 billion redevelopment to scoop it up themselves.

The owners of now vacant land at the former Sykes Center, a 152,000-square-foot outpatient health care facility at 2535 South Martin Luther King Drive, demolished the building and planned to sell the property to data center operator Equinix for $30 million, reported Crain’s. Yet, the owners claim that 4th Ward Alderwoman Sophia King and Goodman, who’s a key part of the GRIT team behind the Bronzeville Lakefront project, conspired to block any sale of the property, diminishing its value with plans of buying the lot themselves.

The lawsuit claims that the outgoing Lightfoot administration illegally used its zoning power to prevent a would-be legitimate transaction, as city council ultimately has the final say whether or not a development gets approved. King allegedly told Equinix she would block a data center project on the site because the city wanted to purchase it at a lower price than Equinix was paying the sellers, the suit said.

The Sykes site owners consist of Michael Madura, Brett Walrod, Steve Disse and Jeff Devine, Cook County records show. Disse and Devine are leading industrial property sales brokers for Colliers’ Chicago office.

In addition, the lawsuit claims that the city steered Equinix towards developing a data center at the Bronzeville Lakefront property. Eventually, the owners terminated their deal with Equinix and began negotiating with Goodman.

The plaintiff also alleged that the city told the Sykes owners that they needed to lower their asking price to $15 million to gain approval, which ultimately is what Goodman offered to acquire the land. The owners are now seeking $15 million in damages to make up for the lost land value, the outlet said.

Bronzeville Lakefront is a $3.8 billion multi-use campus at the site of the former Michael Reese hospital. The 48-acre mega-project will include medical research facilities, mixed-income housing, retail spaces, offices and a park. Construction is expected to be completed in 2024, according to the city.

GRIT has an agreement with the city in which it will pay $97 million for the project incrementally over the next 14 years, and the city will chip in $67 million to help finance the development.

Along with Goodman and the city, the defendants named in the lawsuit are Deputy Mayor Samir Mayekar, Planning and Development Commissioner Maurice Cox, Goodman’s Farpoint Development real estate firm and GRIT.

— Quinn Donoghue