Daley Seeks $98 Million for Southeast Side Development Project

Proposal would bring a residential and commercial mini-city to former U.S. Steel South Works site near lakefront

July 28, 2010 - Chicago Tribune

The long-dormant expanse of lakefront property that once housed the U.S. Steel South Works plant inched closer to rebirth as a new Southeast Side community on Wednesday when Mayor Richard Daley asked the City Council to kick in up to $98 million in infrastructure costs.

The move comes after more than four years of negotiations between the city and developer McCaffery Interests Inc., which together with U.S. Steel Corp. plans to transform the barren 500-acre site over the next couple of decades into a $4 billion mini-city of high-rise apartments, town homes, parks, shops, offices and medical facilities that would be home to 150,000 people.

The city's participation, which is likely to be approved by the council, would involve issuing bonds that ultimately would be paid back with property taxes generated by the development. The money would pay for infrastructure, such as street construction, for the first phase of the project, which is expected to get started in 2013 after a re-route of South Shore Drive is finished.

A massively ambitious project even in the best of times, the so-called Chicago Lakeside Development will not get the city assistance until it can demonstrate the first phase is viable, city planners said. The developers will have to meet certain minimum requirements, such as having lease commitments for 60 percent of the planned retail space.

The city's assistance is critical, Daley said, because of the tract's sheer size.

"This is one of the largest pieces of property on the lakefront on the Great Lakes. This has huge impact," he said. "You have to have a plan, because most of these areas are laid dead in the country if you don't remediate them. ... This is what you have to do, rebuild your inner city."

The $397 million first phase will involve building close to 1,000 apartments and town homes and a retail village of about 800,000 square feet on 87 acres in the northwest portion of the parcel, which is adjacent to the South Shore neighborhood. Even that phase will be done in smaller increments, said developer Dan McCaffery.

The first phase should create 1,500 temporary construction jobs, and once stores open, 991 permanent jobs, the city projects.

"To now see this come to fruition, or at least to be very, very close to it, is close to a dream come true," said Ald. Sandi Jackson, 7th, who has long pushed for redevelopment of the site.