Chicago Old Main Post Office Is Up For Grabs

Nearly every Chicagoan has experienced the oddity of driving straight through the massive Old Main Post Office taking the Ike downtown. In 1996, the Postal Service moved to a new building across the street, leaving the old building vacant. For the past 20 years, not much has happened there other than the occasional fire from commuter train exhaust and Batman. The current owner, Bill Davies, bought the building from the Postal Service in 2009. Since that time, Mr. Davies has unveiled several proposals for the site (see here, here and here); however, not a single hammer has swung at the property. Last week, Rahm Emanuel announced that the City plans to light a fire under the current owner’s tuchas to get to work. How does the City light this fire… by seizing the property through something called eminent domain.

How Can The City Just Take Away Someone’s Property?

The City of Chicago has an inherent power to take private property for public use. This power is called eminent domain. When the power of eminent domain is used, the Fifth Amendment of the U.S. Constitution requires that the property owner be given “just compensation.” Just compensation is usually determined by an appraisal of the taken property. The most common use of eminent domain is when the government takes control of property for the purpose of turning it into an overtly public use. Eminent domain is used, for example, when the state or federal government wants to clear the way for a new road or highway.

In this case, however, the City’s intention is not to take the Post Office and turn it into an obvious public use. Rather, the City plans to immediately hand it over to another private developer; a use that seems rather non-public. In fact, the City will begin soliciting bids from private developers to buy and redevelop the Old Post Office as early as this Spring; well before the City would actually acquire the property. It should come as no surprise that the City’s plan does not sit well with Mr. Davies.

Can The City Really Do This?

The short answer is probably yes, as long as the City pays Mr. Davies “just compensation” for the Old Post Office property. The Eminent Domain Act (EDA) requires that the City’s acquisition of the Post Office be for the benefit, use, or enjoyment of the public and necessary for a public purpose. 735 ILCS 30/5-5-5(c)-(f). You might think that taking the Post Office from one private developer to sell it to another private developer is not a public purpose, but the law suggests otherwise.

The Court’s definition of public purpose and benefit in regard to eminent domain is expansive and malleable to suit the government’s agenda. According to the Illinois Supreme Court, “It is flexible, and is capable of expansion to meet conditions of a complex society that were not within the contemplation of the framers of our constitution.” People ex rel. Adamowski v. Chicago Railroad Terminal Authority, 14 Ill.2d 230 (1958). In fact, the U.S. Supreme Court has held on more than one occasion that the taking of property from one private owner to give to another is in fact for the benefit of the public. See Hawaii Housing Authority v. Midkiff, 467 U.S. 229 (1984) and Kelo v. City of New London, Conn., 545 U.S. 469 (2005).

Additionally, Courts give great deference to a legislative body’s determination that the taking is for the public benefit. Keystone Bituminous Coal Ass’n v. DeBenedictus, 480 U.S. 470 (1978). As a result, city council would almost certainly pass an ordinance to this effect in order to bolster the City’s position if needed. City of Chicago v. St. John’s United Church, 404 Ill.App.3d 505 (2d. Dist. 2010). In order to thwart the City’s maneuver, the current owner would have to show that there is no necessity for the use of eminent domain, or that the quantity of the property sought to be taken is grossly in excess of the amount necessary for the public use. City of Chicago v. Vaccarro, 408 Ill. 587 (1951).

Simply put, the City holds most of the cards in this situation. Mr. Davies may be able to delay things, but it will soon be put up or shut up time for him. Either way, though, I am excited to see what finally happens with the Old Post Office. Our days of driving through the Old Post Office to get downtown may soon be coming to an end.

Some History on the Building

Since its expansion in 1932, the Old Chicago Main Post Office has been the anchor of the southwest corner of the Loop. Its uniqueness presents several challenges for redevelopment. Interestingly, the vehicle tunnels going through the middle of the building were constructed 20 years before they were actually used. The City knew they wanted to build the Congress Expressway (now the Eisenhower) back in 1932, they just didn’t know when they would build it. So, they convinced the Post Office to include the tunnels in the design. A great picture of the tunnels without the road can be seen here. In addition, the building is simply massive. It rests on almost an entire city block, and it was built with floors that stretch uninterrupted for the entirety of the building. Practically speaking, there is almost no way to repurpose that design that make financial sense, which means any redevelopment would require a massive demolition. Finally, and perhaps the biggest challenge, are the train tracks that run underneath the building. They cannot be moved, and they must be worked around. Suffice to say, demolition of a massive building without disturbing the interstate highway that runs through it, or the trains that run under it, will be a rather delicate and expensive task.