Magazine article American Libraries

We Never Expected a $3-Million Windfall

Magazine article American Libraries

We Never Expected a $3-Million Windfall

Article excerpt

When I read about the refinancing of ALA headquarters that resulted in a $3-million windfall for the Association (AL, Dec. 1999, p. 7), I could not help thinking back to the time when the new building was only a dream and all the things we had to do to make the dream a reality.

A few weeks after I began work as ALA Executive Director in August 1972, I was served a legal summons regarding ALA's effort to withdraw from an agreement with a local Chicago real estate developer to build a new building on the ALA property.

After I recovered from my shock that neither the Executive Board nor ALA legal counsel had informed me of this agreement when I was hired, we were able to extract ourselves from it a few months later. However, I emphasized to the board that ALA needed additional space, but could not afford to buy it or build it without assistance.

Other Chicago real estate developers advised ALA to sell its property and consider moving to a less costly location where it could expand. But it was our judgment that staying at 50 East Huron was integral to the identity of the Association. Therefore, I asked ALA Controller Mel Kirk to interview any developer who wanted to partner with the Association to develop our property.

ALA had amassed most of a square block bounded by Wabash Avenue, Superior Avenue, Rush Street, and Huron Street. It was one block off Michigan Avenue, which Stanley Marcus of Neiman Marcus had called "the most important shopping street in America." ALA owned two buildings, 50 East Huron and 716 North Rush Street. The rest was a vacant lot used by ALA employees and neighbors for free parking. Kirk's charge was to find a developer who would accept ALA as a partner whose only contribution to developing the property would be the land.

Dan Levin of McHugh-Levin Associates and brother of U.S. Senator Carl Levin (D-Mich.) accepted those terms. McHugh-Levin had a good reputation for developing residential apartment towers in Chicago.

Earl Talbot, ALA's real estate attorney at Kirkland and Ellis, worked with Mel Kirk and Dan Levin to craft a legal agreement that was about two inches thick. The agreement called for ALA to contribute the vacant land adjacent to the 50 East Huron building. In exchange, ALA would receive 50,000 square feet of finished office space with a separate entrance. …

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