For residents and investors in Bronzeville, gut-check time is at hand. Decisions will be made in the coming months about properties that could determine the historic neighborhood’s future.
Will those involved be up to the task of turning a profit without pricing those of modest means out of another lakefront community? Big money is on the move in Bronzeville. What will be its legacy?
Over the next year or so, an investment group led by Farpoint Development will work to finalize with the city its plans for the site of the former Michael Reese Hospital at 29th Street and the lakefront. Paired with acreage the developers are acquiring from the authority that runs McCormick Place, the site totals about 100 acres. A lot of things could happen there, and whatever gets built won’t displace anybody, an important advantage for the buyers.
It also serves as a connection to other strategic sites. One is the Prairie Shores apartment complex along King Drive between 26th and 31st streets. It is immediately west of the Reese property. Its five towers comprise 1,675 units and — what do you know — it’s just been sold to Farpoint and Chicago’s Golub & Co. for what Real Capital Analytics said is $180 million.
Goldman Sachs Urban Investment Group provided equity in the deal. The seller was the firm Draper and Kramer, which developed Prairie Shores more than 60 years ago as part of Ferdinand Kramer’s visionary commitment to integration and affordability on the Near South Side. Kramer, who died in 2002 at age 100, was a towering figure in 20th century Chicago. Not everything worked out as he hoped, but he always thought finance and social justice were stronger together.
There’s ample room here for suspicions; developer seizes opportunity in a lakefront site and plans to add frills while raising rents out of sight. Scott Goodman, founding principal of Farpoint, and Golub President Michael Newman, emphatically say that’s not what’s going on. Goodman called Prairie Shores “workforce housing,” a term that shows he appreciates its community roots. The marketing brochure for the property by the HFF brokerage said Prairie Shore’s average rent is $1,158 a month and the complex has 94 percent occupancy.
“It’s an ecosystem unto itself. There’s a lot of open space and it’s been a great place for families. We won’t be repositioning it,” Goodman said, meaning he won’t price it only for the rich.
But why then drop so much cash on the property? It’s believed to be the largest Chicago apartment complex to change hands since Presidential Towers in 2007. “We have a lot of interest in what goes on there,” Goodman said. “We wanted to control the next-door neighbor.”
The Golub firm is best known for its downtown property interests. Prairie Shores, Newman said, “is part of the fabric of Bronzeville. We hope it’s a growth corridor for the city, and we understand this development’s place in it.” He said he’ll look at renovations and upgrades to tenant services, but he emphasized changes would be made deliberately and in consultation with the residents. “We want the best and brightest ideas. There’s nothing set in stone,” he said.
Prairie Shores’ future will depend on the Reese property, where everything is frustratingly vague despite action behind the scenes. Farpoint’s partners in the venture include Draper and Kramer, Loop Capital, Chicago Neighborhood Initiatives and Bronzeville Community Development Partnership. Investors are in line for federal tax incentives because the land is a designated Opportunity Zone.
Talk centers around a life sciences campus, logistics, senior housing, a Metra station and better connections to the lakeshore. Look for the developers to ask for tax increment financing for the public improvements, despite that becoming a flashpoint. The site’s alderman, Sophia King (4th), has ruled out a casino as offensive and destructive to Bronzeville’s heritage. She and Mayor Lori Lightfoot will shape the ultimate plan.
Draper and Kramer has an interesting role here, aside from its piece of the Michael Reese action. It still owns the Lake Meadows apartments at 500 E. 33rd St., an 1,800-unit complex just south of Prairie Shores. It has floated ideas over the years to replace the Lake Meadows buildings with greater density.
It’s CEO, Todd Bancroft, who took over in 2018, declined an interview but sent this statement, “As a company, we are focused on new opportunities we see in ground-up development as well as acquisitions, both here in Chicago and in other markets positioned for long-term growth.”
In Bronzeville especially, he’s got big shoes to fill.