Thousands of new residences and mixed-use development planned for South Loop in ‘The 78’
July 6, 2018

An education hub led by the University of Illinois system, near a riverwalk, will be a key component of the new 62-acre, South Loop development.

By Nathan Worcester

Related Midwest plans to develop “The 78,” a 62-acre, mixed-use development bounded by Roosevelt Road, 16th Street, Clark Street, and the Chicago River.

The site, which developers mean to be seen as Chicago’s 78th neighborhood, will include a five-acre river-front with bikeways, cafes, and other amenities. A seven-acre public park offers another highlight and will follow the Chicago River’s original contours before engineers and a host of workers straightened it. Additionally, the development will host the Discovery Partners Institute, an interdisciplinary research hub within the University of Illinois system meant to spur innovation in computing, health and food research, environmental science, and other areas.

“One of the things we’re really trying to do is maximize open space,” said Michael Ellch, vice president of development at Related Midwest. “It will be high density housing.”

The site once was owned partly by political fundraiser Antoin “Tony” Rezko and General Mediterranean Holding (GMH), a financial holding company controlled by Iraq-born billionaire Nadhmi Auchi. During his 2008 corruption trial, Rezko did not disclose a $3.5 million loan he received from GMH, prompting U.S. District Judge Amy St. Eve to jail him based on concerns that he was a flight risk.

GMH remains a partner in the project. Related Midwest is a wholly owned subsidiary of The Related Companies, L.P., owned primarily by billionaire developer Stephen M. Ross. Phil Enquist of Skidmore, Owings & Merrill LLP designed the project’s master plan.

The planned Wells-Wentworth Connector, a new road and transportation corridor that will link Chinatown with the Loop, is facilitating the development. Ellch stated work on the connector ideally will begin within the next three months, with financing coming in part from tax increment financing (TIF) money.

When asked if TIF funds would be used for anything other than the Wells-Wentworth Connector, including the new “78” development, Daniel Egan of Alderman Daniel Solis’s office declined to comment. “All TIF funds, however, will be used for infrastructure development,” he noted.

Ellch said Related Midwest was exploring public financing to move the Metra line west but had not committed to an approach yet. The development also will include a new Red Line CTA station at 15th and Clark Streets as well as protected bicycle lanes along the Wells-Wentworth Connector and potentially along Clark Street.

Renderings courtesy Related Midwest
A planned Crescent Park will provide green space for residents and the public.

Ellch did not cite how many residents the development will house, saying interest from companies seeking office space might lead developers to decrease the number of planned dwellings. He did confirm that the City of Chicago’s recent Planned Development Designation capped the housing units maximum at 10,000.

Related Midwest indicated that 20% of housing units in the development will be affordable housing. Ellch noted the projected price tag of $5 billion was “directionally accurate,” adding that it likely may be larger and cost more than the $8.5 billion O’Hare expansion.

Ellch did not offer a definitive project timeline. “Completion of the project is going to be a function of market demands,” he said, later noting it could take anywhere from ten to 15, 20, or more years.

“Globally, as a company, [Related] is having a really difficult time with how we feel about traffic and parking,” said Ellch. “We’ve had so much change in recent years with Uber and with public transit. It’s changing how our residents think about cars.” Ellch said the development’s planned parking would occupy the base of buildings and the area beneath the planned park.

Officials also have named the site as a prospective location for the second Amazon headquarters, should the company select Chicago. Ellch declined to comment in detail about Amazon.

Community groups generally expressed support for the plan, though some raised questions about whether the plan was as bold or as place-specific as possible.

“I’ve been looking at and thinking about the planning for this vacant land for nearly 40 years,” said Dennis McClendon of South Loop Neighbors, who noted his organization had not taken an official position on the project. “From what I’ve seen of Related’s plans, I like everything except the name.

“It will be imperative that the 15th and Clark Red Line station be funded and built right away, before the Discovery Partners Institute opens or any office development occurs,” McClendon added. “Moving the Metra tracks westward opens some exciting possibilities for humanizing Clark Street and giving access from the east. The new LaSalle Street gives good access from Roosevelt Road.

“As the project goes forward, however, I think it will be important that such a big site gets broken into small parcels with a traditional street and building framework,” McClendon noted. “If we want a new Chicago neighborhood that feels like an extension of authentic Chicago neighborhoods, we have to cook with the right ingredients.”

Speaking on behalf of Alliance for a Greener South Loop, Gail Merritt praised the plan but questioned whether 20% affordable housing is sufficient. She explained that, while her organization supported Friends of the Chicago River, they could not see the way forward for that group’s proposal to turn the entire site into a park.

“I would like to see how the developers address points raised at the last community meeting, and I would like to see more ways for the surrounding communities to provide input,” said Merritt. “Our quality of life, as measured by congestion at least, is bound to suffer.

“If it becomes a public transportation hub and has excellent pedestrian and non-motorized vehicle transit options built into the design—not added as an afterthought—that would be welcome,” Merritt added. “If it is a net-zero energy site, even better. As important as the environmental impact is to consider, I think the other components of a sustainable community should be part of the equation too. How can a neighborhood provide real employment for economic sustainability to its middle class residents? Is there even a place for middle class residents?”

In its proposal, Related Midwest claimed the development would create more than 10,000 jobs. Ellch said its retail spaces would focus on food and beverage, fitness, lifestyle, and similar service industry sectors.

The 78 “is really meant to be a cross-section of Chicago,” said Ellch. “That’s part of what will make it attractive for potential employers.”

For the Alliance for a Greener South Loop, go to www.facebook.com/GreenerSouthLoop/. General Mediterranean Holding’s website is www.gmhsa.com. More on Related Midwest can be found at www.relatedmidwest.com. Solis’s website is https://www.cityofchicago.org/Ward25/. For the South Loop Neighbors, log on to www.southloopneighbors.org.