The City Council moved Wednesday to turn a financial albatross on Chicago taxpayers into an economic engine with potential to generate $3.1 billion in new tax revenue for the city and create nearly 10,000 jobs.
Before adjourning for the summer, aldermen laid the groundwork for a massive mixed-used development on the site once occupied by Michael Reese Hospital.
In a rapid-fire series of votes, the Council:
• Agreed to sell the 48.6-acre site to the Farpoint Development-led team known as GRIT Chicago for at least $96.9 million.
• Earmarked $60 million from Mayor Lori Lightfoot’s $3.7 billion capital plan to repay developers of the project — known as “Bronzeville Lakefront” — for new and improved roads and a two-acre park at the site, which stretches from 26th Street south to 31st Street and from Lake Park Avenue west to Vernon Avenue.
• And authorized zoning for nearly eight million square feet of residential and commercial uses.
The first phase of the roughly $4 billion project is to include a research facility operated by Israel’s highly regarded Sheba Medical Center, plus senior housing and a community welcoming center on the southern portion of the property.
Ultimately, under the plan, there would be 4,800 residential units, with 20% set aside at reduced rents for people with lower incomes.
Ald. Sophia King (4th) said the project will bring “billions of economic development dollars into our city, back into our tax base.”
She credited the Michael Reese Advisory Committee for “a lot of the community benefits that you see,” including a senior building and a $25 million commitment toward a new or existing school in the community — once three million square feet of construction are complete.
“This is a mega-development that will truly impact the entire city — and, of course, the Bronzeville and Douglas community more specifically. While it will bring billions in economic development to the city and community, it will also bring other tangible investments,” King said.
King acknowledged her colleagues have heard the particulars “ad nauseam” during committee meetings held over the last two days. But she ticked them off one more time.
“Senior buildings, retail and open space. ... Good jobs, both short-term and long-term. ... We’ll also pay homage to the Bronzeville community and to Michael Reese and their storied histories. A Bronzeville welcoming center with a digital museum” funded partly through a 50-cents-per-square-foot impact fee, the alderman said.
Prior to the final vote, Housing Committee Chairman Harry Osterman (48th) credited King for “countless hours devoted to going line-by-line through” the redevelopment agreement.
The infrastructure work must be designed, engineered and completed to city standards within three years at a cost of no more than $60 million. If the final tally is higher, GRIT Chicago must eat those costs.
Chicago taxpayers also will be asked for $31 million to remove hazardous waste left behind by a radium processing plant that was on the northern end of the property more than 100 years ago. That money is expected to come from a nearby tax increment financing district.
Thirteen years ago, then-Mayor Richard M. Daley convinced the Council to borrow $85 million to purchase the site of the shuttered hospital to pave the way for construction of an Olympic Village. But it never was built, and the price of the property rose to $91 million after the city’s stunning first-round knockout in its bid for the 2016 Summer Games.
When the property was not unloaded to private developers within five years, the price rose to $96 million and the city was forced to start making payments on the loan.
Chicago taxpayers had been assured there was no chance of that happening, as top mayoral aides said they were certain Chicago would host the 2016 Olympics — and even if the city didn’t, developers surely would gobble up the land.
Daley and his team turned out to be wrong on both counts. Rio de Janeiro won the 2016 Summer Olympic Games. And the Michael Reese property — cleared of all buildings except the 72,800 square-foot Singer Pavilion — has remained vacant and a drain on the city’s taxpayers.
That financial albatross has now been replaced by the dream of a brighter future — never mind that the ambitious project will take at least 20 years to build.