Sterling Bay, Lori Lightfoot Trade Blame for Lincoln Yards

The blame game over Lincoln Yards is heating up again.

The fallout over the tumultuous $6 billion project, once touted as Chicago’s next big development frontier, has turned into a battleground between Sterling Bay and former Mayor Lori Lightfoot.

The company, which originally proposed the megaproject and is set to lose control of the entire 53-acre site, is speaking out after fresh criticism from Lightfoot over the collapse of the plan, the Chicago Tribune reported. Sterling Bay has completed just one building on the site once envisioned to feature riverfront parks, office towers and thousands of apartments, and even the one finished structure is a vacant life sciences lab that has sat empty since 2023.

While the dispute between Lightfoot and Sterling Bay spilled into the public several years ago, it’s being rehashed as fresh allegations were lobbed by the former mayor at an Axios event last month.

Lightfoot accused Sterling Bay CEO Andy Gloor of making misleading claims about the city’s role in project financing. In response, Sterling Bay defended its position, citing pre-existing capital commitments and blaming political hurdles, particularly the Lightfoot administration’s reluctance to support infrastructure bonds.

Amid financial turmoil, Sterling Bay relinquished control of Lincoln Yards’ northern half to lender Bank OZK earlier this year, marking a significant setback.

However, hope for a renewed development plan emerged as Chicago-based JDL, in partnership with Los Angeles-based Kayne Anderson, began negotiating this year to acquire the entire 53-acre site at a fraction of the Sterling Bay-led investment group’s acquisitions costs. JDL’s involvement signals a shift toward a more residential-focused plan.

The project’s collapse was multifaceted. Despite initial approvals and the city’s promises of tax increment financing, securing additional funding proved elusive for Sterling Bay, and the difficulty was exacerbated by rising interest rates and diminished commercial real estate demand post-pandemic. Political tensions further complicated matters, with disputes over funding mechanisms and community support becoming increasingly contentious.

Lightfoot framed the project’s collapse as rooted in weak financing. Sterling Bay has pointed to political hurdles, especially the city’s refusal under Lightfoot to support a special service area to back infrastructure bonds. Lightfoot says she declined because the firm returned shortly after her election asking for “a billion more dollars.” The developer called the claim “patently false.”

In a statement to the newspaper, the company accused Lightfoot of “celebrating hundreds of millions of dollars in investor losses and billions more in economic opportunity lost under her watch.”

— Judah Duke