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Legal Battle Could Derail Emanuel's South Side Development Plans

Zoning issues threaten to postpone the Chicago mayor's tourism agenda

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Legal Battle Could Derail Emanuel's South Side Development Plans

Chicago Mayor Rahm Emanuel's plans to develop a Marriott hotel and DePaul basketball arena near the McCormick Place in the South Loop may have hit a brick wall over zoning issues.

The Chicago Sun-Times reports a "legal skirmish" between West suburban developer CenterPoint Properties Trust and San Francisco-based Digital Realty, which operates a data center on property next door to land being sold by CenterPoint to the state-controlled Metropolitan Pier and Exposition Authority, aka "McPier," for the Marriott/DePaul project. At issue: a 15-year-old zoning pact involving land-use regulations.

McPier recently issued a stamp of approval to purchase CenterPoint's property -- the last slice of land needed for the development venture. All told, the Authority will put down $40 million to expand its land ownership as part of a plan to revitalize the area around McCormick.

"The resolution is critical to finalizing the sale of the property from CenterPoint to McPier in order to move forward with the project," quoth a Sun-Times source, while another insider said: "Both CenterPoint and Digital Realty have mutual interests, but are fighting over who should assume what costs. Meanwhile, the plans for McCormick Place on the west end of the block have to go forward before the deal is closed at the end of the month."

Last month, Emanuel revealed his $1.1 billion proposal to add a 10,000-seat DePaul arena across from the convention center and redevelop Navy Pier, among other tourist-baiting tweaks. His pitch to funnel $55 million in tax increment financing into the project prompted vocal opposition from groups including the Chicago Teachers Union.

The mayor has been on a tourism kick these past few months with public grabs for the James Beard Foundation Awards, Barack Obama's presidential museum and library and the NFL draft, among other, in his bid to boost Chicago as a global hotspot.

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