Two companies proposing giant real estate projects in Chicago have fired the law firm of Ald. Edward Burke – just a couple of weeks after federal prosecutors charged him with attempting to extort business for his private practice.
The companies are Sterling Bay, the developer of the $5 billion Lincoln Yards project on the Near North Side, and Related Midwest, which plans to build a $7 billion development called “The 78” in the South Loop.
Both were among many real-estate owners that have employed the Klafter & Burke firm to appeal their property taxes, with Burke pocketing a cut of whatever he is able to save them.
A spokeswoman for Related Midwest told WBEZ on Thursday the company was “no longer engaged with Klafter & Burke,” but would not say exactly when those ties were cut.
And a Sterling Bay spokeswoman said the development firm had “terminated” Klafter & Burke as its lawyers due to “recent events.”
That was a clear reference to the corruption case filed against Burke, the longtime 14th Ward alderman, in federal court here on Jan. 3.
Burke is accused of trying to shake down the owners of a Burger King in his Southwest Side ward to hire his firm to appeal their property taxes. Prosecutors allege he used his clout at City Hall to hold up a renovation project when the restaurant owners didn’t hire him for property tax work.
Burke has said he did nothing wrong, but quickly resigned as chairman of the Council’s Finance Committee. He’s still planning on running in the Feb. 26 city election.
The case against Burke has rocked City Hall – where he’s held enormous power for 50 years – and next month’s race for mayor.
And now, business interests are trying to move swiftly to ensure that the Burke scandal does not also taint their two highly ambitious development plans. The proposals are among four major developments seeking to share in a $1.5 billion subsidy proposal pending before aldermen.
Sterling Bay is fighting to win support for its plans to transform a vast swath of Chicago’s Near North Side.
The Lincoln Yards proposal is targeting 70 acres of industrial land along the Chicago River.
But the project has generated furious opposition from people who live in the Bucktown and Lincoln Park neighborhoods. And it has yet to win the crucial backing of Ald. Brian Hopkins (2nd Ward).
“Sterling Bay has nearly 50 properties throughout the Chicagoland area and we work with nearly a dozen different tax counsel for tax-related matters,” the company’s spokeswoman, Sarah Hamilton, said in a statement. “We had used the services of Klafter & Burke on a limited number of our properties, but given recent events, we have terminated the use of their services.”
Midwest Related’s plans are so grand that developers say the project would amount to creating Chicago’s 78th neighborhood.
The proposal, which covers 62 acres along the Chicago River south of the Loop, won zoning approval for 10,000 new homes, but still is seeking $500 million in tax-increment-financing funds from the city.
The spokeswoman for Midwest Related said Klafter & Burke was among three different law firms that had been working to help reduce the property tax bills of the company.
Many of Burke’s private law clients have an interest in legislation before the Council. For years, Burke has disclosed having dozens of clients who do business with the city.
WBEZ and the Better Government Association reported last month that Burke had abstained from voting 464 times in the past eight years, under a rule that allows aldermen to recuse themselves when they have a conflict of interest.
Dan Mihalopoulos is an investigative reporter for WBEZ. Follow him at @dmihalopoulos.