A hotel developer is suing the law firm he hired for work on a Loop hotel project, accusing it of helping a competing businessman scuttle the plan.
Brian Scheinblum, owner of Chicago Hotel Partners, is asking a Cook County Judge to order Schain Banks Kenny & Schwartz pay him as much as $120 million over the failed project, according to Cook County Record.
Scheinblum hired the firm to help him close a deal to develop a hotel inside the Pittsfield Building, a historic former office tower at 55 East Washington Street. Chicago Hotel Partners received city permission in June 2015 to construct the hotel, and it began extensive demolition work that summer, according to Cook County Record.
But at the same time, the law firm was working with businessman Adam David Lynd, an opponent of the hotel plan who was eventually successful at blocking the project.
According to the lawsuit, the firm advised Lynd to seek a zoning change on the Pittsfield building, which would effectively ban hotel uses in the property. The City Council approved the change in March 2016, according to the suit.
With the hotel deal scuttled, the building owners filed for bankruptcy and the property was sold in 2017. Scheinblum now is seeking at least $30 million in compensatory damages, plus as much as $90 million in punitive damages, according to the suit.
Opponents of the hotel project used a familiar tactic in seeking a zoning change to kill the project. Now-retired Ald. Danny Solis (25th) downzoned a site in Pilsen to block a project from Property Markets Group, an action the developer is challenging in court. And after its development site was downzoned on the Northwest Side, Glenstar Properties opted to build office space instead of fight for its mixed-use plans in court.
[Cook County Record] — Joe Ward