Sept. 14 (Bloomberg) -- Chicago must pay a Morgan Stanley-led investment vehicle $58 million it won in arbitration over the city’s violation of a 99-year lease of four parking garages on the east side of its downtown.
Chicago Loop Parking LLC claimed the city breached the 2006 accord when it allowed a new building in its near east side neighborhood, called the Aqua, to offer public parking.
State court Judge Sophia H. Hall in Chicago yesterday rejected the city’s bid to alter the award rendered in February. The city contended a May agreement with the Aqua’s owner to end public parking there eliminated its liability for future damages.
Hall, in a written ruling, said she had no authority to change an arbitration award the city conceded was lawfully rendered and that even if she had that power, she couldn’t do so based on facts created after the arbitration proceedings ended.
The third-largest U.S. city, Chicago has a population of almost 2.7 million people. Chicago Loop paid it $563 million for the lease in 2006. It had demanded $200 million in damages for the Aqua’s incursion when it filed for arbitration in 2011.
Roderick Drew, a spokesman for the city’s law department, didn’t immediately reply to voice-mail message seeking comment on Hall’s decision.
Scott Burnham, a spokesman for Chicago Loop, declined to comment. He is affiliated with the Chicago-based public relations firm Serafin & Associates.
The case is City of Chicago v. Chicago Loop Parking LLC, 13-CH-13381, Cook County, Illinois, Circuit Court, Chancery Division (Chicago).
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