A plan for a multidecade, $3.8 billion redevelopment of the former Michael Reese Hospital site won a key city approval Thursday amid praise for its economic impact and its respect for the surrounding community.
The approval by the Chicago Plan Commission bolsters hopes that construction on a first phase can start in a few months. But the overall project remains susceptible to changes in the market and specific buildings will require future public reviews.
In all, the zoning classification recommended for the South Side site near the lakefront allows for 7.8 million square feet in a mix of uses. It calls for 4,800 residential units, with the investor team led by Farpoint Development committing to setting aside 20% of them at reduced rents for people with moderate incomes.
The first phase would be anchored by Israel’s Sheba Medical Center, which plans a research facility called the ARC Innovation Center. Senior housing is included in the first phase, too, as well as a welcoming center for Bronzeville.
The construction would take place near the southern end of the roughly 52-acre property near 31st Street and Lake Park Avenue. A park also would be included, part of the nearly 10 acres of open space in the plan. The property is near McCormick Place and the Prairie Shores and Lake Meadows housing complexes.
The city has owned the former hospital site since 2009 when former Mayor Richard M. Daley agreed to buy it for $91 million as part of an unsuccessful attempt to get the 2016 Summer Olympics. The city has been paying interest on the deal ever since.
Plan commission members and aldermen praised the project’s design, which evolved over years of talks with community groups. Ald. Sophia King (4th) told the commission, “The tense discourse has made for a much better development.” Her ward includes the property.
The city’s planning commissioner, Maurice Cox, said the project “truly promises to create an integrated neighborhood in Bronzeville.” Scott Goodman, founding principal of Farpoint, said the project reflects the equitable investment goals of Mayor Lori Lightfoot’s Invest South/West program.
Other commission members noted the site will no longer be a financial drain to the city and will start producing tax revenue. City Hall has yet to finalize a redevelopment agreement, including a sale price and tax incentives, with the development team. Goodman said the project could generate $2 billion in tax revenue over 20 years.
The plan commission’s unanimous approval is an important step, sending the zoning rules to the City Council for final approval.
The Singer Pavilion, the last structure that remains from the old Reese campus, would be incorporated into the development. Although the zoning allows for a range of commercial uses, it specifically rules out a casino or off-track betting facility. Community members strongly opposed gambling at the property and have pushed for high-quality jobs.
The project drew criticism from some who addressed the commission hearing. They were affiliated with the hotel workers’ union, Unite Here Local 1, and said the developers have not committed to creating hospitality jobs with high levels of pay and benefits.
A hotel is allowed under the zoning, but the developers have not said there will be one. Referring to the pandemic’s effect on tourism, Morgan Malone, director of development and external affairs for Farpoint, said, “We’re not quite sure when the market will bounce back for financing hotels.”
She said the developers will work with a coalition of labor and other groups to reach agreement on jobs and community hiring.
Developers have estimated the project eventually could produce more than 30,000 full-time jobs and at least 17,000 construction jobs.
The first phase could occur through 2026, the developers said. It would limit building heights to 350 feet and provide 230 below-grade parking spaces. The developers have estimated the much larger second phase might not be finished until 2041.
Citing the location just south of McCormick Place, Ald. Walter Burnett Jr. (27th), said, “I think they’re going to get a lot of visitors to the area.”
Additional partners in the development team include Loop Capital Management, McLaurin Development Partners, Draper & Kramer, Chicago Neighborhood Initiatives and Bronzeville Community Development Partnership.
In other business, the plan commission deferred a vote on a proposed two-tower hotel and residential development near Wabash Avenue and Ida B. Wells Drive. Ald. Brendan Reilly (42nd) said he and local groups need to review changes the developer wants.