While some are holding off on real estate investments and some lending standards have changed rapidly amidst the pandemic’s effect on the economy, the Chicago development scene hasn’t exactly frozen. A coming slowdown is still very possible as planned, unfinanced projects are put on hold, but for the time being, there is plenty of activity to go around.
Even a project that seemed to be in trouble, the 8000 North mixed-use development in downtown Skokie, has seen new life amidst the crisis. The 153-unit building couldn’t get a construction loan, but a new developer stepped in and hopes to finish the project by late 2021. Next door in Evanston, City Council approved the first new downtown high rise office building in 20 years. Count the developer, Vermilion Development, among those that don’t believe working from home will crush demand for Class A office space for the foreseeable future.
A major benefit for developers has been that Illinois’ stay-at-home order never halted construction or construction permitting, unlike in some other places. Among those receiving permits in recent weeks were a 306-unit apartment tower near Cook County Hospital and Salesforce Tower, a prominent skyscraper that will be among the city’s most visible at Wolf Point. Meanwhile, plans move forward on the city’s next megaproject, Farpoint Development’s life sciences mixed-use campus on Bronzeville’s former Michael Reese Hospital site.
As for the city’s largest developments already in progress, Lincoln Yards and The 78, plans cautiously move forward there as well. With the complexity and multiple phases of these projects, full completion isn’t expected for nearly a decade anyway, hopefully far beyond the impacts of a pandemic-dampened economy. But delays or modifications remain possible: an ambitious redevelopment of the former AT&T campus in Hoffman Estates, for example, will look to lease some existing space immediately, rather than waiting until more progress is made on upgrading the site.
One area that city-imposed regulation has slowed things is in demolitions, although ironically that may have happened regardless of the pandemic. A Little Village demolition that showered local residents in soot led to a citywide moratorium on demolitions, which inadvertently stalled redevelopment plans for a City Sports building in Uptown at Broadway and Wilson. The developer, The John Buck Company, hasn’t yet released its plans, but presumably will once the moratorium is lifted and they are able to move forward with the site.
Clearly, activity in the development world hasn’t stopped, which should provide new projects coming online throughout the recovery. One area to watch now is for new residential projects in north Fulton Market after Alderman Walter Burnett just lifted a ban on such projects. Burnett had opposed all new residential developments north of Lake Street in an attempt to protect industrial businesses in the area. In a city that has still heavily respected aldermanic prerogative on proposed developments, this is welcome news for developers.