Bulletin: IL2025002

Dear Associates:

In September of 2024, the City of Chicago approved a municipal ordinance known as the Northwest Side Preservation Ordinance. A copy of the ordinance can be found here. The ordinance shall be in full force and effect on March 1, 2025.

The ordinance amends sections 2-44-135 and 17-7-0590 of the existing Municipal Code of Chicago. Under section 17-7-0590, boundaries of The Predominance of the Block (606) District (“the District”), areas commonly known as Avondale, Hermosa, Humboldt Park, Logan Square, and West Town are amended. Rental property on parcels zoned RS3 and RT3.5 located within the District will be affected.

The ordinance also introduces a new chapter of Title 5 of the City of Chicago Municipal Code for Housing and Economic Development. The new chapter, 5-11, shall be known as the Tenant Opportunity to Purchase Block (606) District Pilot Program. Chapter 5-11 grants a Right of First Refusal to a tenant and/or tenant association of rental property, as defined in the ordinance, within the District.

All transactions involving the sale of real estate in the District are subject to the following guidelines:

1.  Commitments issued in connection with the sale of real estate in the District, and affected by the ordinance, must include the following exception:

Pursuant to Chapter 5-11 and sections 17-7-0590 through 17-7-0593 of the Municipal Code of Chicago, the City of Chicago Municipal Ordinance known as the Northwest Side Preservation Ordinance may apply to certain parcels zoned as RS3 and RT3.5 located in The Predominance of the Block (606) District. This includes, but is not limited to, a Right of First Refusal for the sale of the property granted to the tenants/tenant’s association. This commitment is subject to the terms, provisions, and conditions of the Ordinance including, but not limited to, any and all loss, damage, or liens arising out of or related to the violation of the Ordinance or failure to comply with terms, conditions, and requirements therein.

NOTE: Any endorsement or coverage regarding this exception must be approved by a Stewart Title Guaranty Company underwriter.

2.  Tenant lease exceptions on Schedule B of the final policies issued in connection with the sale of real estate in the District, and affected by the ordinance, shall not include affirmative language related to any right of first refusal without approval of a Stewart Title Guaranty Company underwriter.

3.  Issuance or modification of any ALTA 4, ALTA 5, or ALTA 9, or ALTA 34 series endorsement (including but not limited to any ALTA 5, 9, 9.6, 9.6.1, or 9.9, 34, or 34.1 endorsement) or similar endorsement or affirmative assurance providing coverage for loss or damage resulting from a violation of, or failure to comply with, the right of first refusal in the Ordinance to Date of Policy will require approval by a Stewart Title Guaranty Company underwriter.

For additional guidance on this matter, please contact a Stewart Title Guaranty Company underwriter.

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