North Branch property owner sues General Iron, city - Jonathan Cartu Industrial & Residential Real Estate Firm
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North Branch property owner sues General Iron, city

North Branch property owner sues General Iron, city

After making peace with the city, General Iron Industries now faces a fight with a neighbor.

A local real estate investor that owns several retail properties near the metal recycler’s notoriously gritty scrapyard on the North Branch of the Chicago River alleges in a lawsuit that the exit plan announced last month by Mayor Lori Lightfoot’s administration allows the company to wreak environmental havoc on the neighborhood through the end of 2020 and is harming local business in the meantime.

The complaint, filed this week in Cook County Circuit Court on behalf of a venture led by Chicago real estate investor Kenneth Skolnik, seeks a court order that the city rescind General Iron’s operating permits for the facility at 1909 N. Clifton Ave. (Read the complaint below.)

The suit was filed roughly a month after General Iron, the Lightfoot administration and 2nd Ward Ald. Brian Hopkins—who has led a charge to shutter the facility for years—announced an agreed-upon timeline for the company to move and that the company would comply with all relevant environmental rules until it leaves.

General Iron is selling its business and assets at the Lincoln Park facility to Twinsburg, Ohio-based industrial recycling company Reserve Management Group, which plans to open a new operation at 11600 S. Burley Ave. on the east side of the Calumet River.

The lawsuit also comes as General Iron markets the site for sale. The Skolnik venture could be among the suitors for the prime piece of riverfront property as the historically industrial corridor of the North Branch transitions into new commercial uses. The site is adjacent to a 55-acre parcel along the river between North and Webster avenues where Chicago developer Sterling Bay plans to build Lincoln Yards, a 14.5 million-square-foot mixed-use development featuring skyscrapers rising nearly 600 feet.

General Iron’s planned move isn’t soon enough for the Skolnik venture, whose Clybourn Corridor retail properties are anchored by stores including Best Buy and Binny’s Beverage Depot. It argues in the lawsuit that General Iron remains a traffic and safety hazard and continues to break environmental rules.

Metal recycling trucks idling along Kingsbury Street have “usurped” the public way, creating noise, odors and traffic jams that affect business there, according to the complaint, which argues that the Skolnik venture has experienced damages in excess of $100,000 as a result of General Iron operations.

“The city has closed their eyes and failed to act on what are very clear violations of their own rules, as well as the rules of the EPA and basically allowed this to continue unabated for another 18 months,” said lawyer George Bellas, who is representing the Skolnik venture.

General Iron spokesman Randy Samborn said the Skolnik venture has recently “made overtures” to General Iron about the potential sale of the site and suggested the timing of the lawsuit “seems only to be motivated out of bitterness” that the company has not entertained them.

Samborn also issued a statement disputing allegations made in the lawsuit.

“General Iron is confident that it will prevail in seeking swift and decisive dismissal of these inaccurate and meritless claims,” the statement said. “The company takes pride in complying with, and outperforming, applicable environmental regulations, and looks forward to demonstrating its commitment to protecting public health and the environment.”

The statement noted that the company’s exit agreement and permits issued by the city of Chicago, the Illinois Environmental Protection Agency and the U.S. EPA ensure it is up to code. General Iron also recently installed new equipment that addresses specific environmental claims raised in the complaint, the statement said.

Among the public health concerns raised by residents near the North Branch is “fluff”—a hazardous waste byproduct of shredding automobiles—showing up in residential back yards.

Bellas said his client’s motivation in filing the lawsuit “is set forth in the complaint. It is to stop the pollution, the noise and the interference with local businesses now rather than in an indefinite time in the future.”

The Skolnik venture accuses the city of Chicago in the lawsuit of breaching public trust by failing to enforce pollution laws and not keeping “public streets and thoroughfares unobstructed and in a reasonably safe condition.” Last month’s agreement to shutter also didn’t adequately address resident concerns, the suit alleges. A spokesman for the city’s Law Department said the city has not yet received the complaint and declined to comment.

Real estate services firm Jones Lang LaSalle is set to receive bids this month for the General Iron property.


Real Estate Jon Cartu

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