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Chicago Mayor Brandon Johnson is proceeding with a revamp of empty downtown buildings initially estimated at $1 billion in an effort to counter a commercial real estate crisis that’s cut sale prices by more than 50%, Bloomberg News reported. The city, run by a progressive Democrat who’s been in power for less than a year, has been working with developers to refine plans to repurpose buildings along and near LaSalle Street, once known as the Wall Street of Chicago, according to the city’s Chief Financial Officer Jill Jaworski. An announcement is expected by the summer after high interest rates delayed the project, she said. Chicago, like many other cities in the U.S., has been struggling to fill empty offices after the pandemic hollowed out downtowns. Johnson’s move to keep an initiative kick-started by his predecessor Lori Lightfoot will help combat vacancy rates in the city’s central business district, which climbed to a record in the fourth quarter, according to real estate brokerage Jones Lang LaSalle. “It’s taken a little bit longer to get things going but we are working closely with those projects and doing what we can to move them forward,” Jaworski said in an interview on Friday. “We expect that we will see projects get announced and get off the ground in the near future.” Lightfoot, the first Chicago mayor to lose a reelection bid since 1983, first announced plans to repurpose almost 2.3 million square feet of vacant space — the equivalent of almost 40 football fields — in September 2022. The future of the so-called LaSalle Street Reimagined initiative had been in question since Johnson took over in May. Read more.

ABI will present a program April 30-May 2 that will address CRE exposure: the 2024 Distressed Real Estate Symposium, to be held in Ojai, Calif. Click here to register!

Long Island community leaders are demanding an overhaul and oversight to save Nassau University Medical Center, which is in danger of running out of money, CBSNews.com reported. The safety-net hospital is in imminent fiscal danger of insolvency. It serves the uninsured, underinsured or those on Medicaid. Critics claim cronyism caused the fiscal mismanagement. It's time that we have County Executive Blakeman call for the termination of Matthew Bruderman," said Nassau County Legislator Siela Bynoe (D). Two years ago, Bruderman was appointed NU Health chair and pledged to turn the medical center around in six months. The hospital is now weeks away from running out of money to pay its staff. "The county will be on the hook and therefore the taxpayers will be on the hook for the debt that is looming," said County Legislator Debra Mulé (D). The state health commissioner sent a terse letter saying funding is available with strings attached: oversight, transparency and accountability.

The lawyer responsible for guiding Alex Jones' media company through bankruptcy will ask a judge for permission to drop out of the case at a court hearing next week, saying that he has irreparable disagreements with the company's management, Reuters reported. Bankruptcy Judge Christopher Lopez in Houston, Texas, said on Friday that he would convene an emergency hearing on March 11 to consider a request by Ray Battaglia, who has been lead bankruptcy counsel for Infowars' parent company Free Speech Systems since 2022 after Battaglia said his relationship with the company's chief restructuring officer, Patrick Magill is "fundamentally broken." Magill, who is in charge of day-to-day operations at FSS, has withheld Battaglia's legal fees for January and February as "blatant retaliation" for a Jan. 25 disagreement about whether or not FSS should pursue litigation over a legal claim, Battaglia said in a Feb. 29 court filing. Battaglia did not describe the legal claim, but he said that pursuing it would be "ill advised." FSS and Jones filed for bankruptcy after being sued over Jones' repeated lies about the 2012 Sandy Hook elementary school massacre.
A judge has since ruled that Jones cannot use his personal bankruptcy to avoid paying at least $1.1 billion in defamation verdicts that the families have won against Jones in court cases in Connecticut and Texas. The families of the Sandy Hook shooting victims have voted for a bankruptcy plan that would liquidate Jones' assets, if approved in court.

The mystique of Jay Peak, the northernmost ski area in Vermont, is intimately bound to the Jay Cloud, a mythical storm cloud that hovers over its rocky summit. The resort, five miles from Quebec, claims to receive more snow — an average of about 350 inches — than any resort east of the American Rockies, and even more than many Western ski areas, including Park City, Utah, and Steamboat Springs, Colo. But another cloud, for years, hung over Jay Peak Resort: Its former owners perpetrated the biggest financial fraud in ski industry history — as well as the biggest fraud in the state of Vermont, the New York Times reported. In 2016, officials from the Securities and Exchange Commission seized the ski resort and accused its owners, the longtime Jay Peak president, Bill Stenger, and a Miami businessman named Ariel Quiros, of defrauding foreign investors of $200 million in a Ponzi-like scheme. Both men landed in jail. The ski area remained open while under federal receivership, emerging from it in the fall 2022 when the area was purchased by the Park City-based Pacific Group Resorts for $76 million.

Crafts retailer Joann Inc. is considering a bankruptcy filing as soon as next week as part of a deal that would hand control of the company to lenders while allowing it to shed expensive debt, Bloomberg News reported. The company, which sells fabric and craft supplies and has around 850 stores in the U.S., has been holding confidential talks with its lenders as it seeks fresh capital to bolster its cash reserves. Discussions are ongoing and plans aren’t final, but the company is seeking to line up enough support from lenders that would allow it to exit chapter 11 quickly in what’s known as a pre-pack filing. Joann has struggled to maintain liquidity and manage inventory levels amid a challenging environment for retailers. It raised more than $34 million in a sale and leaseback deal for its Hudson, Ohio facility, but is contending with high interest expenses and required term loan payments, Moody’s Investors Service wrote in a note in January.

The U.S. bankruptcy judge who is weighing whether to dismiss the bankruptcy of prison healthcare company Tehum Health said on Friday that he doesn't intend to make a sweeping ruling on so-called "Texas two-step" bankruptcy cases, Reuters reported. Opponents of Tehum's bankruptcy, including prisoners who have sued over substandard medical care and the U.S. Department of Justice, have argued that the company's predecessor Corizon Health abused U.S. bankruptcy law when it created a new shell company, Tehum, and placed it into bankruptcy to halt lawsuits filed against Corizon. Bankruptcy Judge Christopher Lopez said during a Friday court hearing in Houston that he intends to take a narrow view of Tehum's bankruptcy and its proposed $55 million settlement of creditor claims, without making a "sweeping ruling" on the Texas two-step or other companies' efforts to resolve lawsuits in bankruptcy. "For me, those issues are for policymakers and not for this court," Judge Lopez said. Tehum filed for bankruptcy in February 2023, shortly after its predecessor, Corizon Health, used a Texas statute to split itself into two companies, YesCare and Tehum. YesCare inherited Corizon's assets and its go-forward business, while Tehum was stuck with the liability from about 200 lawsuits accusing Corizon of providing prisoners with substandard medical care that led to injuries and deaths at 50 detention facilities in 27 states.

The shrinking North American box office has forced a 100-year-old movie theater operator into bankruptcy, Bloomberg News reported. Metropolitan Theatres Corp. — a family-owned business operating 16 theaters in California, Colorado and Utah — said in court papers that the COVID pandemic and its aftermath on the movie industry stressed its liquidity. Last year’s Hollywood strikes are a further blow because fewer film releases are expected through 2025, the company said. Much-larger peer AMC Entertainment Holdings Inc. avoided bankruptcy during the height of the pandemic, but Regal Cinemas parent Cineworld Group Plc filed chapter 11 in 2022. Others have either gone bankrupt or closed in recent years, including the former owner of the historic Cinerama Dome in Hollywood. Metropolitan Theatres said in Thursday’s filing that it doesn’t have enough cash to make-up for this year’s poor ticket sales without reducing rent at its remaining locations. President David Corwin, in a sworn statement, also highlighted continued pressure from streaming as North American ticket sales are down roughly 20% this year. Corwin, whose family has owned Metropolitan Theatres since it was founded by Joseph H. Corwin in 1923, said the company intends to use chapter 11 to negotiate rent reductions with landlords and close locations it can no longer afford. The firm pays about $2.6 million annually in rent, a cost he said continues “to be a drain.” Metropolitan Theatres elected to file for subchapter V under chapter 11 protection. The company filed customer motions to continue paying ordinary business expenses, including wages for 240 part-time and 12 full-time employees.

As a Boy Scout victim from Alabama, Gill Gayle is likely to get around $15,000 from a settlement fund compensating child sexual abuse victims, according to estimates. But if he had been abused in New York, he would be eligible for more than 10 times that amount. Gayle is one of more than 82,000 men who have submitted claims to a multibillion-dollar settlement fund set up after the Boy Scouts of America filed for bankruptcy amid an onslaught of child sexual abuse cases, the Wall Street Journal reported. Victims are each entitled to up to $2.7 million from the fund, according to court documents, depending on the severity of the abuse they experienced and other factors. But the settlement is designed to pay out less to men like Gayle, who grew up in states where their claims would likely be barred because too much time has gone by. Some say the settlement as structured is generous — offering the men more than they likely would receive had they pursued their claims in state court. But others say it creates a patchwork where men abused in one state receive a fraction of what those in others receive. Men in more than 30 states will likely have their awards reduced based on local statutes of limitation. The Boy Scout settlement has drawn renewed attention to statute-of-limitation laws that determine how long victims or prosecutors have to sue perpetrators. In recent years, some states have adjusted those laws in the wake of high-profile scandals, like sexual abuse within the Catholic Church or USA Gymnastics. Some lawyers and lawmakers say the different statutes — and different payouts — reflect a core tenet of American governance, where states have different laws on any number of topics.