The City of Chicago has mandated that residential real estate developers obtain a City of Chicago Residential Real Estate Developer license by September 30, 2004 and time is running out for developers to comply. Even a real estate developer whose business is based outside the City will be required to secure a Chicago real estate developer’s license if it operates within the City. Please note that single-family home owners making improvements to their own homes are exempted.
What If I Don’t Comply?
For those who have not yet started the process, it is critical that all real estate developers that are covered by the ordinance initiate this licensing process immediately. The ramifications if one fails to secure a license are serious. Specifically, if a real estate developer fails to obtain the license, the City’s Department of Planning and Development and the Department of Construction and Permits will hold approvals or building permits for a project until the developer obtains the requisite license. In addition, the City will prosecute the case and impose fines and court costs. The potential impact on project timing is significant.
The ordinance also imposes a host of additional important requirements, any one of which could delay or prevent licensing or halt a project. Among these: three or more violations of the ordinance on three different days within a 12- month period may result in license revocation. If that happens, the developer may not reapply for a license for a period of four years from the date of revocation. This consequence of chronic failure to comply could force some entities or individuals out of business.
Chicago Will Enforce This Ordinance
We believe that the City will enforce this ordinance, and its ability to halt a project at the DPD or DCAP level is significant. It is critical that all real estate developers that intend to operate in the City of Chicago take immediate action to comply with the ordinance, if they have not yet done so. The Piper Rudnick License and Permit Team is ready to help clients negotiate this process through the City.
This article is intended to provide information on recent legal developments. It should not be construed as legal advice or legal opinion on specific facts. Pursuant to applicable Rules of Professional Conduct, it may constitute advertising.