$57 Million Chicago Ford Dealership Delayed As Aldermen Play Politics

TTAC Staff
by TTAC Staff

FMG Holdings, which operates a number of car dealerships in western Michigan under the name of Fox Motors, had planned on spending $57 million turning an abandoned industrial site on Chicago’s North Side into a large Ford store but it has now given Chicago politicians an Oct. 1st deadline to either approve or deny their zoning application after the issue has gotten mired in local politics and injected with the issue of race.

According to Automotive News, FMG had approached Alederman Scott Waguespack about his support of their plan to develop a 102,000 square foot Ford dealership in his ward, Chicago’s 32nd. The store would replace a defunct dealership also in Chicago, and it would employ about 200 people.

Waguespack solicited feedback from constituents, who approved, so he decided to support FMG, though he turned down their request for a tax-increment financing subsidy. The Chicago Plan Commission also approved the zoning request, but then the plan stalled after other aldermen representing predominantly Hispanic wards got involved, asking what Ford has done to give franchises to Hispanics.

One of the aldermen, Danny Solis, chairman of the City Council’s Latino Caucus, also chairs the City Council Committee on Zoning, which has tabled Fox’s request twice. Solis gives Ford’s lack of any Hispanic owned dealerships in the Chicago area as his reason. “We want some form of commitment from Ford,” Solis says. “Ford should be sensitive to giving a fair shake to the Hispanic community.”

While Ford may not have any stores in Chicagoland owned by Latinos, one particular Latino, Jose Diaz, whose family used to own a Miami, Florida Chrysler dealership and who is said to maintain a residence in Chicago, seems to be the person that Solis has in mind, as it is Diaz’s name that Solis has suggested to Ford. Diaz has been promoting his own plan to open up a dealership in a different location than in the 32nd ward. He’s also given campaign contributions to Latino aldermen, inlcuding $6,800 to Solis’ 25th Ward Regular Democratic Organization. Solis denies a connection between those contributions and his inaction on Fox’s zoning request.

Chicago Mayor Rahm Emmanuel’s office said that the request will come up for a committee vote on Sept. 4 and a full city council vote later in September.

Because of the delay, Fox says that it had to extend an option to purchase that would have expired in early August but a spokeswoman said that it would be the last extension the company would seek and that if a decision wasn’t rendered before October, they would walk away. Still, the company knows it has to be diplomatic.

“From our experience, when you go through zoning, it has to do with whether you’re complying with the law,” Monica Sekulich, general counsel at Fox Motors, told the Automotive News. “We’re frustrated by the [Chicago] process. But we’re optimists. … We are excited about doing this deal.”

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  • Chicago Dude Chicago Dude on Aug 14, 2013

    TTAC Staff with another hatchet job. JB, I thought you wanted to clean this place up. The linked article is completely one-sided with no fact checking. A couple seconds with Google will show anyone that cares that Ald Waguespack and Ald Solis are in a giant feud over the ward remapping. Solis thinks that the new ward boundaries (which have not yet legally taken effect) should be used in zoning matters. Waguespack disagrees. Shocking, really. Furthermore, a few seconds with Google will show anyone that Chicago has been trying for decades to preserve industrial zoning, especially on large parcels such as these. Of course, the perception is that America doesn't make anything anymore, but the reality is that we do. This particular site didn't become vacant because of the economy or China or anything like that. It's because that intersection is NOT the intersection of Fullerton and Elston, it's the intersections of Fullerton, Elston and Damen which is one of the worst intersections in the city with an extremely high accident rate. The city is rebuilding the intersection to be safer and needs land to do it. Instead of an expensive and lengthy eminent domain process, they gave Vienna Beef TIF money to build a new hot dog factory elsewhere in the city. The construction hasn't even started; as far as I have heard the design hasn't even been finalized. And during construction, the city will probably want to use the vacant site for construction staging. So really, there is no reason for the city to rush anything. Solis is perfectly aware of this. Waguespack is too, but he's just needling Solis by sending him the zoning issue and making Solis look like the bad guy. Lastly, of course, is the question of why the city would rezone for an auto dealership at all, if they were going to be rezoning at all. A large percentage of the taxes collected on the sale of a car goes down to the state government in Springfield, never to return. Rezoning as residential in an area of high and growing home prices promises a lot of money in property taxes that stays in the city and county. A new high rise in my neighborhood was just recently approved (with no demands for minority ownership or work contracts) with zero issues. It takes the site (just a fraction of the size of this industrial site in question) from producing about $250,000 in property taxes annually to producing about $25,000,000 in property taxes annually. Perhaps that puts this measly $50 million investment into perspective. Welcome to the big city, FMG Holdings.

  • DinosaurWine DinosaurWine on Aug 14, 2013

    This is exactly what is wrong with Chicago - a company wants to set up shop in your neighborhood and these corrupt idiots just can't allow that to happen without getting their cut. Now the plans are on hold and the property sits unused as Ford tries to figure out how not to give away their dealership to a well-connected local businessman. My guess is this probably won't go forward, and we'll have to hear about how Republicans have driven all the jobs out of Chicago.

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    • Tuffjuff Tuffjuff on Aug 14, 2013

      @Chicago Dude It's insight like this that makes me glad to live in a suburb of Green Bay. Gross.

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