Building O (195 North Columbus Drive), the Sybil of downtown Chicago skyscraper projects, may be delayed by a bit of intrigue playing out in our nation’s capital. According to the Chicago Sun-Times, the building which consists of two hotels and a residential block, was going to be financed through the federal government’s EB-5 program. But now that program is coming under fire from not only the General Accounting Office, but the big guns at the Department of Homeland Security.
For those of you unfamiliar with EB-5, it’s a way for rich people from other countries to get visas to live in the United States if they write a big enough check. It sounds like citizenship for sale to the highest bidder, but it falls short of that. Most countries have similar programs. Some surprisingly nice ones will let you in for as little as $30,000. At least to live in America you have to cough up at minimum of half a million dollars to get in the door.
How it works is that someone overseas with a fat wallet and a yearning to live free can invest in construction projects here in the United States. In return, they get to live here. Usually the minimum investment is a million dollars, but if they invest in some really crappy parts of the land of liberty they can get away with just a half-mil. Americans get jobs and new buildings, and foreigners get to live in a place better than where they started out. Everyone is happy.
Except for certain portions of the federal government. The G.A.O. is upset because the portion of the federal government that oversees the program doesn’t have any way of telling if any American jobs were created. Homeland Security is upset because there’s no checking to make sure that the people getting these visas aren’t the sort of people who should be kept at arm’s length. After all, the world has no shortage of people with giant bank accounts who wouldn’t mind seeing America reduced to a pile of smoldering hubris.
In Illinois, there are a couple of dozen companies that administer these EB-5 schemes in exchange for a fee from the investors. Usually they end up building things like nursing homes downstate and in rural areas where the New York banks won’t invest. There’s one EB-5 company called Tri-State USA that is trying to raise money to build an Aloft Hotel in Lincoln Park. Also on its web site is a huge downtown condo+apartment+Hilton skyscraper called Grand Central that it’s working on, designed by friends-of-the-blog Goettsch Partners.
Which brings us back to Building O. The Sun-Times’ digging into the simmering federal controversy turned up some familiar names: Former Mayor Richard M. Daley and his son Patrick Daley. From the Sun-Times article:
For its part, Magellan tells the newspaper that it is only looking into the possibility of using EB-5 money to build Building O, with no decision having been made yet.
Far-right-wing blogs and publications have started to pick up on the EB-5 story now that it has D.H.S. involvement. If it gains traction and becomes too political, Magellan may need to look elsewhere for the cash to build its new skyscraper.