The Final Piece of Saint Anthony’s Puzzle

Time and time again, over the last several years, the fate of the vacant lot at the southwest corner of 31st Street and Kedzie Ave. in La Villita has seemed all but certain. The former site of the Washburne Trade School, the lot has stood empty since 2009, accruing dust and debris. For nearly a decade, executives at Saint Anthony Hospital, located just a few blocks northwest in nearby North Lawndale, have been lobbying city and state officials to grant them the lot, as well as millions in funding, to develop a mixed-use project featuring a new hospital, businesses, and recreation areas under the name of Focal Point Community Campus.

Despite their success in securing support from high profile politicians, obtaining some community buy-in, and even negotiating the sale of the lot for $1, the Focal Point project remained in stasis. When the Chicago Board of Education, which owns the lot, announced a bidding period last summer, it sat on proposals for months while keeping applicants in the dark. An internal email obtained by the Weekly showed that by February the situation had become dire: Saint Anthony executives were contemplating suing the city over the lot and closing down the hospital if all else failed.

Earlier this month, spokespeople for the city and Saint Anthony told the Weekly that they are in negotiations over developing the lot, though no further details were given. Yet uncertainty permeates the project—from its protracted timeline, to the hospital’s financial woes in the face of the COVID-19 pandemic, to various other obstacles Saint Anthony executives must face before construction even begins. A local group’s objections to the development, their counter-proposal, and the lot’s continued vacancy in the middle of one of the city’s busiest arteries, shows just how complicated development can be in Chicago’s marginalized communities.

Saint Anthony sits on the southern edge of Douglas Park, where its employees have served nearby communities out of the same building for more than 125 years. It is a safety net hospital, meaning individuals can obtain access to health services regardless of their insurance or ability to pay. Most of its patients come from La Villita and North Lawndale, in addition to Pilsen, Brighton Park, and other neighborhoods with large populations of low-income people of color—who are often dealing with environmental pollutants and other health hazards.

Illinois’s safety net hospitals have more Medicaid, charity, and self-pay patients than other hospitals. Consequently, they are more reliant on government funding and are often financially challenged. In 2007, Guy Medaglia, a business consultant, came to Saint Anthony to manage the hospital for eight weeks through a critical financial period. Medaglia decided to stay on as the president and CEO, and the hospital, after cutting ties with healthcare group Ascension in 2009, has managed to stay afloat and even post net positive revenue in years since.

But there were problems with the building. It had been designed for how medicine was practiced in the nineteenth century, and maintenance was expensive. According to Jim Sifuentes, Saint Anthony’s vice president of mission and community development, the idea for Focal Point came from former Mayor Richard M. Daley. “In his last year, he visited Saint Anthony [for the first time]. He said, ‘I have eleven acres … I want to give you that. I want you to build a new hospital,’” referring to the old Washburne lot. Medaglia thanked Daley for the offer, but pointed out that the hospital didn’t have the needed funds. “And the mayor said, ‘Well, I want you to build one. I want you to figure out how to do that.’”

Saint Anthony began working with HDR Architecture, a design firm specializing in architecture and construction services, to conduct a survey in La Villita and surrounding communities. The surveys found there was interest in a range of services. In addition to hospital services, survey participants wanted park space and retail options.

Drawing from these surveys, Focal Point was envisioned as a mixed-use development in which hospital services would be available alongside parks, retail, childcare, and more, to address the various needs of the community. “We hear for spaces to host events, graduations, quinceañeras…business incubators” Sifuentes said.

If developed as planned, Focal Point would not only provide Saint Anthony with a new hospital building, but also address some of the other issues facing La Villita, as reflected by a 2013 report from Enlace Chicago, a community development nonprofit. The report found that a lack of open spaces in La Villita contributed to neighborhood violence, as it left “youth without safe access to positive activities among friends, or with family.” Compounding these difficulties is the fact that many in the community are inhibited by low wages and a scarcity of meaningful, quality jobs. Focal Point, with its plan for a park, businesses, and athletic fields, could address both.

The project would also be financially self-sustaining—or so Saint Anthony executives hoped. As the project has expanded, the expected costs of Focal Point have steadily increased, from $250 million at its conception in 2010, to the most recent estimate, which came in at just under $600 million. Public money and grants were expected to help cover initial costs, but rent from Focal Point’s tenants, of which the hospital would be one, would sustain the project and the hospital in the long term. Once Saint Anthony finished relocating to the La Villita location, the old building in North Lawndale would likely be given over to the Park District, as an extension of Douglas Park, or be converted to senior housing, according to Sifuentes.

In 2012, Medaglia started the Chicago Southwest Development Corporation (CSDC), a nonprofit tasked with envisioning what the Focal Point project would look like, lobbying for land and funding, and eventually developing and maintaining the campus and foundation.

Since its founding, CSDC has bought up much of the land around the Washburne lot. According to property records, in 2014, CSDC took out a $1.15 million loan from the Saint Anthony Hospital Foundation to buy a property south of the lot. In 2017, CSDC acquired Action Metal and Iron Inc., which covered lots to the west and southwest, and in 2018, CSDC obtained Azteca Mall, just south of the lot, with the city’s help. All together, CSDC owns more than 900,000 square feet surrounding the lot, or just shy of twenty-one acres. The Washburne site sits at the corner of all of that land, the last piece in a multi-million-dollar puzzle.

Saint Anthony executives were also busy garnering the support of powerful politicians like Mayor Rahm Emanuel, Senators Dick Durbin and Tammy Duckworth, Congressmen Chuy Garcia and Danny Davis, and nearby aldermen. “Focal Point is a game changer for Chicago’s West and Southwest side communities,” said Durbin. “The campus will be the first of its kind and can serve as a model for community development across the nation.”

Between 2014 and 2017, CSDC was on the brink of acquiring the lot several times. In 2014, the city council voted to sell the lot to CSDC for $1 if CSDC met several requirements, including demonstrating that it had secured eighty percent of the funds for the project. Again, in 2017, the Community Development Commission (CDC) voted in favor of a measure to sell the property to CSDC, again for $1. 

But the lot remained unsold and undeveloped, most likely because CSDC wasn’t able to secure enough funding. In a statement to the Weekly, a spokesperson for Saint. Anthony said that “the conditions for the sale of land have evolved with each mayoral administration” and that financial institutions could not “close on project financing” because CSDC did not have title to all the property—apparently a kind of catch-22. When pressed by CDC members and journalists in 2017 over how much funding had been secured, CSDC representatives did not say.

To fund the project, CSDC planned to take on $175 million in debt and obtain financial assistance from the state and federal government. In the 2017 CDC meeting, a CSDC representative stated that they anticipated receiving $50 million in federal funds for the project, while former state senator Martin Sandoval called for $80 million from the state government to help fund the project. 

Another obstacle was that the land required environmental remediation due to industrial pollution. In 2018, the Environmental Protection Agency awarded the CSDC a $200,000 grant to clean up the land. But CSDC can’t start until it has rights to the property, and according to the spokesperson, CSDC can’t “clos[e] on financing” until the remediation is done.

Starting around 2018, a competitor entered the picture: Cinespace Chicago Film Studio, the second largest television and movie studio in the country. Cinespace, which is located just a couple blocks east of Saint Anthony in North Lawndale, bought Crown Steel in 2018 for $2.8 million, a property just west of the Washburne site. Cinespace had plans to build another studio, but needed the Washburne lot to complete the project.

Cinespace had close ties with the Emanuel administration and other Chicago power players. In 2016, its president, Alexander Pissios, cooperated with the FBI to help bring down Chicago Teamsters union boss John Coli for extortion. Since then, as the Sun-Times as shown, Pissios had $1 million in debt disappear and Cinespace was able to buy several properties from the Emanuel administration within a couple-mile radius of its studio, including a $74 million development deal with the Chicago Housing Authority, of which $4 million in fees would go to Pissios and his partners. But the main frustration for La Villita residents is that Cinespace took ownership of public streets near their current location and blocked residents from walking, driving or biking through their regular routes to work or school.

Despite the years Saint Anthony executives spent trying to obtain the land, “Pissios’ plan…seemed to gain footing with Emanuel in office,” according to the Sun-Times. Saint Anthony’s spokesperson told the Weekly that Emanuel’s administration “posed many more obstacles” to getting the land than those of Daley or Lori Lightfoot. 

In 2019, the Chicago Board of Education opened the possibility of acquiring the lot to the public and announced that it would be accepting development proposals. Both Saint Anthony and Cinespace submitted their plans and presented them to local residents at the first public meeting concerning the future of the lot, which 22nd Ward Alderman Michael Rodriguez organized on August 22. Rodriguez, whose ward includes the lot and who had voiced support for Focal Point back when he was still director at Enlace, seemed amenable to both proposals. “They both have a significant number of…high paying jobs for working class people,” Rodriguez said in an interview with the Weekly. “We’re talking about, essentially, two industries that are a hospital and the film industry, that are both productive industries for working class people to go and get union jobs.”

In the end, the board sat on the proposals for nearly six months, without updates, until December when, according to Saint Anthony’s spokesperson, they announced that they would not be awarding the land to either bidder.

In February, Medaglia sent an email to Saint Anthony employees with an update on the Focal Point project. After claiming that “the Emanuel administration stopped the project by directing the Board of Education to end the bid process for the last piece of property,” Medaglia stated that if they could not get their hands on the Washburne site, “Saint Anthony will most likely have to close. This would deprive a poor area of a great hospital and the much-needed health care it provides.”

Medaglia went on to say that he had hired Michael Shakman, “a Chicago lawyer who has brought legal action against the City in the past,” (he’s the lawyer behind the Shakman Decrees, the federal court orders limiting patronage in city hiring) to “open a dialogue” with Lightfoot’s administration. If the administration rebuffed the advance, “he and his firm have been authorized to sue the City in federal court to obtain the Washburne property.”

Saint Anthony’s spokesperson acknowledged that Medaglia had sent the email, but claimed that “there has never been anything mentioned about the hospital closing…We did start that dialogue and have since been communicating with the City.”

Meanwhile, a spokesperson for Cinespace stated that “CPS returned the earnest money from the bidding process for the vacant lot…some time ago. It is the understanding of Cinespace that the property is no longer available. If the property becomes available again, we intend to explore it as an option for studio expansion.”

At the August 22 meeting, Saint Anthony and Cinespace were not the only entities to present a plan for the old Washburne site. Some La Villita residents, who loosely collect under the name “Mi Villita,” came to voice their opposition to both proposals. They want the city to keep the land and use it for public good.

Howard Ehrman, the group’s progenitor and long-time La Villita resident, worries the developments could accelerate gentrification. “That’s why we oppose it primarily,” he said. “We think that public lands should remain public. It shouldn’t be turned over” to a development that he described as a “real estate project primarily, a hospital secondarily.”

Long-time resident and Mi Villita volunteer Dolores Castañeda agreed. “We want something [that] is for, and belongs to, the community. Everything built on that land should come from community voices,” she said.

Ehrman and others of Mi Villita want the city to build a new vocational school at the site, one that would be “fit for the twenty-first century.” In a press release from last September, Mi Villita outlined a school that might provide training in “traditional trades and twenty-first-century trades” for “renewable energy, information technology, health care, construction, architecture, manufacturing, urban agriculture, electrician, carpenter, plumbing, heating and air conditioning.” In addition, they cited a need for a comprehensive arts program, which is noted to be “lacking in CPS HS [Chicago Public School high schools], especially for Students of Color on the South and West Sides.”

Mi Villita’s proposal, though lacking the financial and organizational support of Saint Anthony and Cinespace, harkens back to the lot’s previous tenant, the Washburne Trade School, itself a microcosm of Chicago’s history. 

Established in 1919 as the Washburne Trade and Continuance school, it had support from many powerful unions. The school moved to a former liquid carbonic factory at 31st and Kedzie in the 1930s. In addition to instruction by up to seventeen different unions and a physical plant for training in manufacturing and service trades, students who graduated from Washburne received union apprenticeship cards. “Washburne played a vital role in regulating the training and supply of skilled laborers into the building trades,” wrote researcher David L. Green in the 1992 Urban Review.

But Washburne wasn’t open to everyone. Its students were all white and majority male. “Unfortunately, this success story between business unionism and soft-line capitalism served also to reinforce the practice of racial exclusionism in most of the building trade unions,” wrote Green. “The unions were able to continue their exclusionary policies with the implicit sanction of the officials of Washburne, the Chicago Public Schools, and the federal government.”

As Washburne eventually integrated non-white and female students around the 1960s, many building trade unions stopped participating in the programs. In 1965, there were seventeen unions in the school; by 1978, there were eight, and by 1993, just two unions remained. Along with the withdrawal of capital from the inner city by business, industrial, and financial institutions (also known as structural disinvestment) and into the suburbs, the country’s manufacturing base saw a general decline.

The school closed in 1993, reopening a year later under the City College system, before closing for good in 1996. The hulking buildings were then demolished between 2008 and 2009, and the land has since functioned as an unofficial dumping site.

“What we’re asking CPS to do is not sell the land to anybody,” Ehrman said. “Because this particular piece of land is four blocks from the geographic center of the city, which is around California and 31st, we think it’s prime territory to not just build a vocational high school, but to think about other public projects.”

Sifuentes, the vice president at Saint Anthony, claimed that Focal Point wouldn’t bring on gentrification. “We actually want to make sure that we’re part of stabilizing [the] community,” he said. Sifuentes added that the retail portion would help the project be successful, but that it wouldn’t compete with local businesses. “It’s retail that’s not going to affect Little Village, 26th Street. In fact, it’s retail that people go to Cicero and North Riverside for—those commodities. We would bring it closer to the community.”

Rodriguez thinks development from either of the projects is the best path forward for the neighborhood. “I think whenever you do development, you have to weigh the fact that we have communities like Little Village, who have historically been disinvested in,” he said. Through these projects, “we have an opportunity to do something really positive for our neighborhood and our community.” According to Rodriguez, both development projects have verbally agreed to community benefits agreements. 

But some Mi Villita members object to the idea of ceding public land, as well as public funds, to private interests. And others, like long-time resident Lacourdaire Camargo, find the current confluence of public and private entities suspect.

“We know that its public record that the newly elected alderman in the ward has received campaign contributions from the lobbying group [Roosevelt Group with Victor Reyes] that is looking to secure or helping to secure financing for this project,” said Carmago. “And we know that employees from the hospital have also been giving campaign contributions to the alderman, in addition to the lobbying group and the CEO of the hospital.” 

The Roosevelt Group, Reyes Kurson (Victor Reyes’s firm), Sifuentes, and Medaglia have given campaign contributions amounting to about $4,700 total, with amounts ranging from $200 to $1,500. (Victor Reyes was infamously recorded by the FBI in 2019, in discussion with former Alderman Danny Solis, asking for the alderman to send over business.) 

Rodriguez denies any undue influence as a result of the donations. “I’m very proud of the limits that I’ve put on myself as far as accepting donations from developers,” he said. “And I will continue to be a progressive champion for campaign finance reform. I think that we need that. So that big corporations can’t control their elected officials.”

The COVID-19 pandemic has created another layer of challenges for Saint Anthony and introduced another level of uncertainty, as the Weekly reported last month. The hospital has been spending more to respond to the pandemic while cutting elective surgeries and other procedures that usually bring in income. Meanwhile, Saint Anthony has not been receiving as much federal assistance because it doesn’t have as many patients on Medicare, one of the factors used in the CARES act to determine how stimulus money is distributed to providers. Between March and April, the hospital lost $10 million, according to a Business Insider article that profiled Saint Anthony and other hospitals that were struggling financially under the pandemic.

Saint Anthony was facing financial problems even before the pandemic. Hospital officials claim that the state has repeatedly been late with reimbursing Medicaid payments and that as of May, the state owed them $22 million since mid-February. In response, Saint Anthony sued the Illinois Department of Healthcare and Family Services in an attempt to recoup some of that money.

It’s also unclear how the pandemic will affect state and city governments in the coming year, and whether there will be funds for large capital projects like Focal Point. When asked about whether hospital officials were still expecting to receive federal and state funds, the Saint Anthony spokesperson wrote, “We can’t know how Springfield will be distributing funds throughout the state. Our focus remains on acquiring funding through traditional lending sources, private investment and philanthropy.”

The spokesperson also argued that the pandemic had “magnified health disparities” and showed why “lower income communities need access to the same quality health care and wellness services that more affluent communities typically have…The pandemic should encourage all stakeholders, including the City of Chicago, to move expeditiously to help CSDC secure the support needed to move the project forward.”

For now, the eleven acres remain only as the site of grand projections and dreams. Stuck in bureaucratic and public health purgatory, the La Villita community, maybe split in opinion, is united in their fight for communal input.

Adam Przybyl contributed to this story.

Josephine Wang is a writer from Chicago. This is her first article for the Weekly.