All posts by ChicagoAdmin

Starbucks Base-Pay Going Up

Business News,
Employees work inside the Starbucks at the Taj Mahal Palace hotel in south Mumbai, India. (Erika Schultz/Seattle Times/MCT) Photo courtesy of Wikipedia
Employees work inside the Starbucks at the Taj Mahal Palace hotel in south Mumbai, India. (Erika Schultz/Seattle Times/MCT) Photo courtesy of Wikipedia

Beginning in October employees at Starbucks, the giant coffee retailer, will be taking home about 5 percent more money in their paychecks. Howard Schultz, CEO of the Seattle-based company, sent a letter to workers last week explaining that the exact amounts of the raises will be determined by market as well as geographic factors.

There are about 7,600 Starbucks across the country. The company does not disclose the exact amounts of starting salaries for their employees, saying it is based on the specific market factors effecting each store individually.

Wages that companies pay for entry level jobs has been an important topic for candidates this election year. The Democratic Party policy platform will most likely include a desire to see a $15 federal minimum wage slowly implemented. Republican candidate Donald Trump has said he prefers the issue of minimum wage be left to individual states to decide.

I addition to wages, Starbucks employees have been demanding that the company give them more predictable and reliable working hours. A petition advanced by a Starbucks employee said that the company was reducing work hours to save on labor costs. The petition said that it is almost impossible to work more than a 25-hour work week, and that the cuts in labor was having a bad effect on worker morale and customer service.

Schultz, who has been in touch with Jaime Prater, the employee who started the petition, said that Starbucks is ready to work with their employees to give them the hours that they need. He added that the company was committed to helping its employees find the right schedule which will insure that they are entitled to worker’s benefits.

O’Hare Expanding with New Gates

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United Airlines corridor, Chicago O'Hare Airport. Photo by InSapphoWeTrust from Los Angeles, California, USA
United Airlines corridor, Chicago O’Hare Airport. Photo by InSapphoWeTrust from Los Angeles, California, USA

Nine new gates may be just the beginning of a major expansion at O’Hare International Airport, already one of the busiest airports in the world.

Mayor Rahm Emanuel announced that he has reached an agreement with several major airlines to build as many as nine new gates, while they continue to negotiate on the possibility of an even larger expansion which could make O’Hare a more convenient airport for passengers boarding and debarking from planes.

Explaining what the expansion would mean for Chicago Emanuel said: “New York, London, Berlin, Beijing — watch out, Chicago’s coming for you.”

The airport has been expanding little by little under the ongoing long-term plans for growth, but that growth has been realized mostly in new runways. A deal on additional gates has been alluding airport planners. Most of the push-back has come from the dominant airlines of United and American, which are worried about allowing for too much competition.

It is unavoidable to add gates, however, if the airport wants to improve its on-time performance. The new runways being built will not help the airport significantly if there are not places for landed planes to park and let their passengers disembark. The result of this lack of gates is that O’Hare has some of the longest flight delays among US airports. With passengers avoiding Chicago, the city’s economy is adversely affected as well.

The plan Emanuel announced involves as many as nine gates to the 25 which already exist at Terminal 5. It is expected to cost $300 million, to be paid for with existing passenger facility charges, the extra fee that is added to the cost of a plane ticket.

Real Estate in Lake Forest is a Hard Sell

real estate, , ,
Lake Forest City Hall, Lake Forest, IL. Photo by Teemu08
Lake Forest City Hall, Lake Forest, IL. Photo by Teemu08

The iconic North Shore neighborhood of Lake Forest has one of slowest real estate markets in its peer group. Homes that were sold in May were on the market an average of 186 days. In the middle of June there were 97 homes which had been listed at least 6 months ago. Other areas with similar homes had less than 20 for sale that long. Hinsdale had 46 homes and Highland Park 57.

“It’s been slow up here,” says Marina Carney, an agent for Griffith, Grant & Lackie. “We’re all feeling it,” says Berkshire Hathaway Home-Services Koenig-Rubloff Realty Group agent Sue Beanblossom, in Lake Forest. “It takes a long time to get something sold in Lake Forest today.”

According to Midwest Real Estate Data, at the end of May Lake Forest had enough homes to supply sales for 14.5 months. In just about all its peers, such as Hinsdale and other North Shore suburbs, the inventory is quite smaller. For those other areas it was between three and 10.5 months at the end of May. A rule of thumb is that a healthy, balanced market has about six months of inventory.

Winnetka is a similar suburb to Lake Forest, but considerably smaller. Nevertheless, seven homes priced at over $5 million has sold in Winnetka in the past three years. In Lake Forest only four have sold.

Real estate agents say that the problem is three-fold: the age of the homes in Lake Forest; the extremely high asking prices; a long commute to downtown Chicago, combined with low-motivated sellers.

 

Southwest Third Midwest Airline to Launch New Uniform Look

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Photo by MamaGeek at English Wikipedia
Photo by MamaGeek at English Wikipedia

Come next spring Southwest Airlines stewardesses will be dolled up in new, Cintas-designed uniforms nothing like their skimpy, eye-catching look of the 1970s. The new uniforms were co-designed with employees of Southwest as well.

Cintas is also creating a uniform facelift for Chicago-based United Airlines, due for exposure next year. Coming in September travelers on American will also be greeted with freshly designed uniforms.

The new uniforms for all three airlines seem to be part of an overall improvement in customer service in the wake of record profits resulting from historic low fuel prices. They are also revamping, along with their uniforms, their images and brands.

Now that Southwest Air is turning 45 it appears they are trying for a more “mature” image. There company has certainly expanded, with 90 destinations, including some international markets.

The new look for the female flight attendants on Southwest features bold blue and warm red: the colors seen on the new Southwest uniform that was launched in the fall of 2014. On top of the uniforms will be Bold red fitted jackets, and an homage to the crazy short shorts and miniskirts of the 70s with a well-placed zipper running up the dress from the hem. The men FAs will get a new look, too, consisting of dark blue pants and jackets over lighter blue shirts. Their neckties will be a bold and brave red.

Chicago Losing Lucas Museum

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George Lucas. Photo courtesy of Wikipedia.
George Lucas. Photo courtesy of Wikipedia.

George Lucas announced he was taking his Lucas Museum of Narrative Art project out of the Windy City due to objections to the project made by a city watchdog group.

Filmmaker Lucas, of Star Wars fame, could take his project back to California. The museum was first proposed for construction in San Francisco, but that city refused to give Lucas a site which overlooked the San Francisco Bay so Lucas brought the project to Chicago where he received support from Mayor Rahm Emanuel.

Friends of the Parks, a green area protection organization, filed a lawsuit to prevent the museum’s construction on valuable lakefront property next to Soldier Field. Mayor Rahm is a vehement supporter of the museum despite coming under criticism for the past several months for that support. Opponents of the museum say Emanuel has been spending too much effort on getting the Lucas Museum built when the city has much more important problems which should be dealt with. The Mayor answered his critics by saying the city is missing a great opportunity:

“This missed opportunity has not only cost us what will be a world-class cultural institution, it has cost thousands of jobs for Chicago workers, millions of dollars in economic investment and countless educational opportunities for Chicago’s youth.”

Lucas also expressed frustration with the city:

“No one benefits from continuing their seemingly unending litigation to protect a parking lot. The actions initiated by Friends of Parks and their recent attempts to extract concessions from the city have effectively overridden approvals received from numerous democratically-elected bodies of government.”

Home Prices Rising in Chicago and the Nation

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Photo courtesy of Mark Moz
Photo courtesy of
Mark Moz

Several parameters have conspired to raise the price of homes in the Chicago area: mortgage rates below 4 percent; home loans are easier to come by; strongest job market since the recession; more people wanting to buy homes. And now, as the housing market enters the traditional season for home purchases, a shortage of homes has added more fuel to the fire of rising home prices.

The real estate website Trulia conducted a study showing that people across the country are finding it difficult to find a home they want to buy at a price they can afford. In Chicago and the surrounding area, and in Illinois in general, sales continue to rise, according to the Illinois Association of Realtors.

“Illinois continues to see sustained growth in sales and median prices, indicating the market is poised for a strong rollout for the spring selling season,” said Mike Drews, president of the state Realtors group, in a statement.

Home sales in the nine-county Chicago area rose by 6.1 percent in February, compared to last year, and prices rose by 7.1 percent. The median price for homes and condos sold was $187,500, compared with $175,000 in February 2015.

In Chicago itself things were even worse: The median price for homes and condos was up by 12.3 percent, to $238,000 from $212,000 in February 2015.

“There was a lot of movement in 2013 and 2014, but 2015 slowed,” said Carla Walker, an agent with Berkshire Hathaway Home Services Koenig Rubloff.

Old Meets New at Chicago’s Merchandise Mart

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Merchandise Mart. Photo courtesy of Phillip Capper.
Merchandise Mart. Photo courtesy of Phillip Capper.

What was once the world’s largest building in terms of square footage, Chicago’s Merchandise Mart, has made some upgrades designed to get “the tenants to stay in the building longer over the course of the day, and working harder,” said David Greenbaum president of the New York-based Vornado Realty Trust.

Vornado bought the property in 1998, and since then has spent $40 million on renovations to appeal to the tastes of the “millennial” crowd.

“Our building, the Mart, has become the epicenter of what is this extraordinary resurgence of River North in Chicago,” said Greenbaum.

The changes were made to the ground level common spaces of the 86-year-old building which sees over 25,000 people passing through each day. The centerpiece of what’s new is a 50-foot-wide marble staircase which connects the first floor with the second. The 38 steps are designed for hanging out, with enough seating for 200 people between the floors. There is free Wi-Fi and a projection screen also in the open space.

At the top of the staircase visitors will be greeted with a spectacular view of the Chicago River and skyline. Also upstairs there is a new lounge with meeting spaces and a brand new food hall dishing out artisanal wares from local vendors. A food marketplace is in the planning stages, and a 5,000-square-foot green area outdoors will be a relaxing picnic space near the river.

Right now the building is 98 percent occupied. There are 550 tenants, including some big names such as Motorola Mobility, 1871, Yelp, eBay, PayPal and Allstate.

The Merchandise Mart opened in 1930, developed by Marshall Field and Co. With 24 floors and 4.2 million square feet of interior space, the building was the largest until the construction of the Pentagon ten years later. In 1945 Joseph P. Kennedy bought the building for $26 million.  The Kennedy Family sold the property to Vornado Realty in 1998 for between $250 and $300 million.

Illinois Residents Can Expect Big Raise in Health Insurance Costs

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Photo courtesy of taxcredits.net
Photo courtesy of taxcredits.net

If Illinois residents can judge from Texas and Oklahoma, they can expect health insurance fees to rise by about 50 percent in the coming months. Chicago-based Health Care Service Corp owns Blue Cross in all three states, and they have requested a 53.7 percent increase in Texas and a 49.2 percent increase in Oklahoma, across its Affordable Care Act plans. It is not a sure thing that these price hikes will be approved, and if the exact numbers are not approved, what kind of rate hikes to expect instead.

Blue Cross is the most popular insurer in Illinois, as it is in Texas and Oklahoma. Mark Spencer, spokesman for HCSC said Illinois’ proposed hikes have not been made public yet. He said it is premature to speculate about the local price hikes since pricing is based on local conditions.

The Illinois Department of Insurance agreed that the rate plans proposed by Blue Cross and other insurers are still under review. It is up to the federal government to publish the new ACA rates, and are planning to do so for Illinois on August 1st, said the spokeswoman for the department, Anjali Julka.

Spencer would not comment on what the company would do if the requested rate hike was not granted. Last year Blue Cross pulled out of the health exchange in New Mexico when the state’s insurance regulators turned down HCSC’s proposal to raise their rates by 51 percent.

Governor Rauner Nixes Mayor Emanuel’s Pension Funding Bill

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Rahm Emanuel, former White House Chief of Staff (2009-2010), Mayor of Chicago since 2011
Rahm Emanuel, former White House Chief of Staff (2009-2010), Mayor of Chicago since 2011

Chicago Mayor Rahm Emanuel received an answer of “no” to his request to pass a bill which would have helped fund pensions for the city’s police and firemen.

Illinois Governor Bruce Rauner said that Emanuel’s plan did not include cost-cutting savings. He said the bill would force the city taxpayers to pay more in the long run.

“Borrowing billions against taxpayers is not the solution,” Rauner said.

But for now the veto will remove $220 million from the city’s budget. The mayor might have to raise property taxes on Chicago residents to make up the deficit. Some critics of the governor say he squashed the plan as much for political reasons and economic. They say that Republican Rauner would like to have some power of Democrats in upcoming fights over budgeting, taxes and the pro-business, anti-union changes the governor is after.

The bill the governor vetoed would have covered the cost of contributions to the Policemen’s and Firemen’s Annuity and Benefit Fund.

“The cost to Chicago’s taxpayers of kicking this can down the road is truly staggering,” Rauner said in the statement. “Chicago is borrowing against its taxpayers to the tune of $18.6 billion. This practice has to stop. If we continue, we’ve learned nothing from our past mistakes.”

Emanuel replied: “With a stroke of his pen, Bruce Rauner just told every Chicago taxpayer to take a hike. Bruce Rauner ran for office promising to shake up Springfield, but all he’s doing is shaking down Chicago residents, forcing an unnecessary $300 million property tax increase on them and using them as pawns in his failed political agenda.”

McDonald’s Testing Fresh Beef in Dallas Restaurants

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Mcdonalds_logoOak Brook, Illinois headquartered McDonald’s announced that it is testing the feasibility of putting fresh beef on its menu in 14 outlets in Dallas, Texas. It is still too early for them to say whether they can take the idea of replacing their frozen hamburger patties across the nation.

The test is so far only being done with quarter pound burger patties.

“Like all of our tests, this one too is designed to see what works and what doesn’t within our restaurants,” said Lisa McComb, a McDonald’s spokeswoman.

The test is taken place during a period in which McDonald is attempting to reverse a recent business slump it has been experiencing. The company wants to try and improve business by improving some of its most basic items on its menu.

McDonald’s is the country’s largest hamburger fast-food restaurant chain, with 14,000 locations.