“Full speed ahead:” City approves millions in public financing for long-awaited Ickes Homes redevelopment
The tax increment financing package means construction can begin later this summer
Updated, June 17, 2:53 p.m.: A long-promised redevelopment of the demolished Harold I. Ickes Homes took is finally set to become reality.
The City Council last week approved nearly $22 million in public financing for the 11-acre mixed-income “Southbridge” campus planned by McCaffery Interests and nonprofit The Community Builders near 23rd and State streets on the Near South Side. The developers say the benefits will allow them to break ground by the end of the summer.
The plan, which secured planning and zoning approval last year, would eventually build 877 rental and for-sale homes and 60,000 square feet of retail space on the former site of the Ickes public housing complex, which the city razed in 2010 as part of former Mayor Richard M. Daley’s citywide “Plan for Transformation.”
During the first regular council meeting held since Mayor Lori Lightfoot and a dozen new alderman took power, aldermen voted Wednesday to allocate $17 million in tax increment financing from the 24th/Michigan TIF district and a $4.8 million “multifamily loan” to the Southbridge development, according to Lightfoot’s office.
Will Woodley, director of Chicago development for The Community Builders, called the vote a “big milestone” for the $97 million first phase of the development, which will include 206 apartments and 16,000 square feet of retail space spread across two buildings. The developer will set aside 68 units for CHA residents, with 112 market-rate apartments and another 26 units rented at affordable rates.
“This allows us to move full speed ahead and close (on the property) so we can start construction in the next few months,” Woodley said.
The financing will also pay for a project to fully connect Dearborn Street and 24th Street with the surrounding grid, he added. The final redevelopment is projected to include sports fields, a running track and pedestrian plazas.
“We’re going to be moving aggressively over the next several years on future phases” of the complex, Woodley said. “But our main goal right now is to get that first phase started so we can establish Southbridge as a mixed-use destination that brings together the South Loop, Chinatown and Bronzeville.”
The first phase is projected to be completed by early summer 2021, he added.
Public financing galore
The city-approved money would join a mishmash of other funding sources including a private mortgage, a $22 million loan from the Chicago Housing Authority and $40 million from the Illinois Housing Development Authority, according to Lightfoot’s office.
Woodley did not say who is providing the private mortgage, or how much it was worth. He added that Goldman Sachs is an equity investor in the development, but declined to say the size of the investment bank’s stake.
The development will absorb most of the roughly $18.1 million in total revenue the 24th/Michigan TIF had on hand as of last year. The district has collected property taxes to fund some $45 million in capital projects since it was commissioned in 1999, city and county records show. It is scheduled to expire in 2022.
The Southbridge site is inside one of the city’s highest-profile Opportunity Zones, which offer tax breaks for equity investors who raise the taxable value of low-income census tracts. But the developers will not pursue Opportunity Fund investments for the site, Woodley said.
Representatives of McCaffery did not immediately respond to requests for comment Monday.