New push for Riverfront developers offers financing flexibility

Written By Fran Spielman Posted: 08/07/2014, 01:11am

Mayor Rahm Emanuel tried Wednesday to jump-start his plan to transform a six-block stretch of the downtown Chicago riverfront into an enticing public space that will someday rival Millennium Park.

After canceling an earlier “request for qualifications” that attracted only three bidders, City Hall issued a new request-for-proposals that allows competitors to propose a “variety of financial structures.”

The goal is to entice a broader array of developers to complete the Riverwalk between Michigan and Lake and make it a “self-sustaining amenity and asset.”

Interested developers must assume control over the entire six-block stretch, not individual chunks. They’ll be asked to develop, promote, operate and maintain both public spaces and more than 100,000 square feet of commercial retail and essentially act as the Riverwalk’s landlord, janitor and No. 1 cheerleader.

Earlier this year, Emanuel launched an international design competition to find a team to deliver on his promise to transform Chicago into “North America’s city of lights.” The city’s “request for design concept proposals” called “Light up Chicago” a “seminal project” with huge potential to boost tourism.

The new Riverwalk RFP is filled with similarly effusive language.

It talks about the potential to drive “$3 billion in net new spending in the Chicago economy” over 35 years.

It estimates that 1.5 million users, 420,000 tour boat patrons and 98,000 retail customers are located within one mile of the targeted six-block stretch. And that’s not including joggers and pedestrians who use the path along Chicago’s “second coastline.”

“With a fully-activated and contiguous riverwalk, the user base will grow significantly,” the RFP states.

“Making the River easier to access will have a profound effect on the number of annual visitors. Seasonal programming, unique gathering spaces to host events and leasable space for restaurants and retail will bring activity and life to the River … giving Chicagoans and visitors a dynamic pathway to experience Chicago and connect to the city’s many cultural, natural and commercial assets.”

Last summer, City Hall closed on a $99 million federal loan that will help complete the downtown Riverwalk.

The loan was made available to the city under the so-called  “Transportation Finance Innovation ACT” created to bankroll infrastructure projects “of regional or national significance” that might otherwise be delayed.

Chicago’s downtown Riverwalk certainly falls into that category. It’s been on the drawing board for more than 20 years — ever since planning started to rebuild Wacker Drive — only to go through a series of fits and starts.

At the time, the city had hoped to begin construction this year, complete the project in 2016 and repay a “significant portion” of the 35-year loan with new and higher fees paid by tour boats using two city-owned docks where Michigan Avenue meets the river.

City Hall said retail leasing, outdoor advertising on informational kiosks and “private donations for sponsorship” similar to those that bankrolled Millennium Park would account for the remaining 30 percent.

The RFP doesn’t provide much more detail about the financing structure.

It simply states that the chosen team will be “responsible for development of the commercial retail, programming, operations and maintenance” for the entire Riverwalk and that the winner “may propose a management agreement or long-term lease with an up-front payment so as to meet the city’s project finance requirements” or an “alternative structure.”

The Emanuel administration has already unveiled “conceptual ideas” and catchy names for each of the six downtown blocks.

State to Dearborn would be known as “The Marina, with restaurants and public seating that allows people to while away their time watching commercial and recreational boat traffic along the river.

Dearborn to Clark would be turned into “The Cove,” featuring kayak rentals and a dock for “human-powered watercraft.” 

Clark to LaSalle would be turned into a heavily landscaped “River Theater” with a wide staircase to Upper Wacker Drive.

Kids who love to splash around in chlorinated and “zero-depth” public fountains would be able to do just that in the one-block stretch from LaSalle to Wells, to be known as “The Swimming Hole.” 

Wells to Franklin would be turned into “The Jetty,” described as a place to learn about the “ecology of the Chicago River” complete with floating gardens and piers for fishing.

And Franklin to Lake would be known as “The Boardwalk,” described as the site of an “iconic bridge” that would bring people from Upper Wacker down to the riverwalk level while surrounding by “floating gardens and landscaping.”

Former Mayor Richard M. Daley’s plan to build a San Antonio-style riverwalk initially called for the city to spend up to $50 million in federal funds to build a river-level boardwalk from Michigan to Lake that would have included 35,500 square feet of retail and restaurant space, along with docks for tour boats and water taxis.

When the work was done, the city would have turned the riverwalk over to a private management company.

But when Daley tried to tackle the project in one fell swoop, only one company responded to the request for proposals. City Hall decided to toss out the lone bid and restart the competition in smaller bites.

After filling in the “missing links” in the Wacker Drive Riverwalk, the city agreed in 2009 to design the rest — even though Chicago taxpayers still didn’t have the money to build it.

The Daley administration issued a “request for proposals” from firms interested in designing the final, six-block stretch. But Daley left office before the dream could be realized.



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