The Preservation Diaries

The Lake Bluff Historic Preservation Commission (HPC) will now enter its fourth month of mulling over whether or not to place a landmark designation on the property at 925 N. Sheridan Road (the former Edward Blair estate on historic Crab Tree Farms, Lake Bluff) as no decision has been rendered despite three meetings to date. The facts presented in this post can be found in the public record, and I know nothing more about this than the public does.

What’s at stake? You might say not that much. The odd thing about a Lake Bluff landmark designation is that it is “all bark and no bite.” It merely places a 120 day restriction on a homeowner’s rights to change the facade of their home. During that time you’d have to negotiate with the board, but after this wait you can go as far as tearing your whole house down without any hassle. Of the 19 total previous homes receiving Lake Bluff landmark designation over the past 7 years, 5 have been demolished and replaced. How many more shall follow?   

If a Lake Bluff homeowner wishes to be considered for landmark designation, they can nominate their home and they will find a very knowledgeable and deeply passionate board of people ready to review the appropriateness of their case. In this particular case however, it is the HPC board that is exercising its authority to step in and consider placing the landmark designation onto a property despite the opposite wishes of the owners and stakeholders. This is where things become troublesome, in my opinion.

The owner, who recently passed away, chose not to seek landmark status. Now the estate is for sale and the proceeds are pledged to charity, so the charities involved are the actual stakeholders here, despite having no say. The representative of the estate is actively engaged with the board, humbly expressing the desire to be left alone and unaffected and unharmed. No thank you, no landmark designation please.

Those without a financial interest cannot see how a landmark designation could harm the market price of the property (or are otherwise not concerned as they desire preservation but bear no financial consequences). Those with a financial interest (and as it turns out an honorable history of supporting Lake Bluff preservation, not to mention having paid significant property taxes) are concerned that it would create uncertainty and therefore could decrease the market value of the property, and thus possibly harm the residual value of the contributions promised to the charities.  

The eventual buyer of this premier $10 million listing will quite possibly (although not certainly) desire the flexibility to increase their utility and enjoyment of the property by erecting a new structure. The buyer acquires 27 acres of lakefront property in Crab Tree Farms and just one house structure is allowed. Just put yourself in the potential buyer’s shoes and think about it.  

I guess it would be a win for all those supporting preservation (and therefore a corresponding loss for the awaiting charities) every time a potential buyer takes a pass on this opportunity due to the perceived inflexibility and uncertainty that comes with landmark designations and the requirement of working changes through a board. I find it interesting that the potential “win for preservation” is such a stale and shallow one since this property is inaccessible to the public. It is completely hidden down a private road deep within private property and it offers absolutely zero opportunity for public viewing or appreciation without trespassing.  How many have even seen it?

I was fortunate to have previewed this property, attending the broker open house last spring. It is a wonderful architectural treasure on an amazing track of land. Anyone who wishes to purchase it can choose to restore it to their desires. The new buyer can easily and readily nominate their home for Lake Bluff landmark designation and should expect an immediate approval. It’s a clear case, just ask and they would receive, right?

The land is unquestionably the major prize. So the new buyer could instead choose to design and build their own dream home. This has been done before around these parts. They would face being needlessly delayed but they would (supposedly) prevail. How would that be fair to the new buyer and taxpayer? And how did that promote preservation?

Let’s assume that a Lake Bluff landmark designation is eminent for this property. What’s a real estate broker to do? If I were fortunate enough to represent a client here, I couldn’t be blogging about this. But since I do not, I cannot resist contemplating what prudent advice might be offered.  

For a buyer facing this added uncertainty, considerable due diligence is obviously required to get them past the fear of buying something that they possibly cannot utilize as they desire. Once the buyer became comfortable with the reality of what a Lake Bluff landmark designation does and does not mean, it could still be used as a major negotiating point against the seller, especially since it is just what the seller fears might happen. During price negotiations, a savvy buyer would have to consider the tactic of reminding the seller that people are turned off by the perceived inflexibility and uncertainty caused by the landmark designation. The idea is to place the seller in the position of trying to secure this transaction through making price concessions, not unlike pointing towards any other unwanted encumbrances. After such negotiations the buyer wins what the seller loses, so under this scenario the landmark designation could end up helping the buyer and hurting the eventual charities.   

So as a counter to this, a seller facing this added uncertainty could immediately announce their intent to get permission to demolish the home. Get that 120-day clock rolling. Potential buyers considering demolition would then be able to see the process as more certain and more easily accomplished. A deal could even be struck where the seller agreed to get the demolition accomplished prior to property transfer. Uncertainty would be removed simultaneously with the home. Potential buyers otherwise considering saving and restoring the home would have the added appeal of ignoring the permission to demolish it and stepping in to save it. So perhaps (and only because the real value is in the land here) this reaction to offset the perceived encumbrance of the landmark designation could protect the seller because it creates a positive for potential buyers, either way. Under this scenario the landmark designation could be negated and thus might not affect market value.

As a buyer or seller, would you consider these approaches? What other approaches could be considered? What do you think the Lake Bluff HPC will decide to do in this case? The public is welcome to follow this saga as it continues…