Tenants sue Compass, Landlord and Broker Over law Violations

A group of tenants is putting Chicago’s controversial Northwest Side Preservation Ordinance to the test by suing their landlord, his broker and Compass for allegedly violating its terms.

Residents of 2417 North Albany Avenue in the trendy Logan Square neighborhood claim their landlord, James Feeney of Traverse City, Michigan, and his broker, Stuart Schwartz of Compass, failed to properly notify them that Feeney was listing the property for sale.

Under the housing preservation ordinance passed in 2024, known as the the Tenant Opportunity to Purchase Act, landlords are required to notify tenants if they plan to sell a property and give them a certain amount of time to either make an offer to buy the building or find a third party partner, such as a housing-focused nonprofit, to make an offer.

The length of time varies depending on the size of the building, but in this case it was supposed to be a 30-day window, according to the lawsuit.

During that time period, according to the ordinance, a landlord cannot evict tenants without “just cause,” such as violations of the lease agreement.

The lawsuit claims the landlord did not renew at least one tenant’s lease due to a pending sale of the property, violating the just clause eviction provision of the ordinance.

Attempts to communicate with the landlord and the broker about the ordinance were unsuccessful, the lawsuit claims.

“There appeared to be either a lack of awareness of TOPA as a law governing sales in this district or a willful reckless disregard of that law,” said the tenants’ attorney Leah Levinger.

She said the tenants have been actively working with third parties to gauge interest in making an offer on the tenants association’s behalf.

“They have not had their chance to meaningfully evaluate a community-minded buyer who can help preserve the building’s affordability,” she said.

The lawsuit, filed in Cook County Court last week, is one of the first tests of the city’s ability to enforce the housing preservation ordinance. The ordinance covers parts of the Northwest Side of the city in an attempt to slow gentrification.

Members of the real estate industry have been vocal critics of the policy, claiming it is confusing, difficult to navigate and stymies investment at a time when new housing starts are at record lows, leading to the same rent growth trends that the ordinance purports to address.

Two alderpersons who originally voted in favor of the ordinance later asked that their wards be removed from its coverage area after pushback from local landlords.

But proponents of the ordinance claim it is necessary to prevent rapid increases in rent that often occur when new buyers take over multifamily properties that have previously been occupied by long-term tenants paying at or below market rent.

The ordinance also requires that landlords disclose financial information about the properties’ operating cost and income so that tenants or third party buyers can determine if a new owner can feasibly take over the building without raising rents significantly.

“Obviously real estate needs to pencil out,” Levinger said. “But the difference between a market rate rent and an operating cost based-rent may be far apart. One of the benefits of [TOPA] is it gets solid information about other operating costs into the tenants association’s hands.”

Feeney and his broker did not share this information, she said.

Schwartz did not respond to requests for comment and Feenery could not be reached for comment. A representative of Compass declined to comment.

Still, at least one multifamily property seller has successfully navigated the new process since it took effect in early 2025.

CRG sold the 134-unit AM1980 Apartments on Bucktown’s border with Logan Square to Chicago-based CedarSt late last year for $35 million, in a transaction that CRG’s Tom Shanabruch called a “frustrating process.”

To get the deal with CedarSt across the finish line, Shanabruch said Chicago-based CRG worked with attorney Kate Duncan at Quarles & Brady to ensure the sale process complied with city regulations. Proving that tenants had been notified of the sale and given the opportunity to form a tenant’s union was no simple task, he said.

CRG sent certified mail to tenants of all 134 apartments notifying them that the building was being sold, which was an expensive process, he said. But getting a response proved even more difficult.