When it comes to private investment in Chicago, money has historically flowed north. Local developers predict that her focus on encouraging growth in underserved communities in the South and West will change that, which will be Mayor Lori Lightfoot’s legacy.
Chicagoans rejected Lightfoot’s second term on Feb. 28, eventually awarding Cook County Commissioner and former Chicago teachers union organizer Brandon Johnson the top job in the city after an April 4 runoff. But the developer, who has benefited from her signature community development initiative Invest South/West, says Lightfoot’s impact on real estate will outlive her four years on the job.
“In terms of the economy and real estate development, there will definitely be a constant focus on [downtown]; first it was the Loop, then it became the South Loop, then it became the West Loop, but under her management, it was the whole city,” said Torrey Barrett of the Imagine Development Group. “It was needed because you had blacks and browns Ethnic developers who just need the opportunities our peers have had for decades. “
Lightfoot’s three-year plan to direct $750 million in public funding to neglected neighborhoods and corridors has funded projects by Barrett and other developers, including affordable and mixed-income housing units, commercial and retail spaces and solar warehouses.
AJ Patton of 548 Development said the strategy elevates minority-led companies that may not be able to undertake large-scale projects without the city’s support.
“There is no mayor who cares more about inclusive development than he does,” Barton said. “She laid the groundwork for inclusive development. Not just contracting and labor; developing co-ownership, full ownership.”
Lightfoot’s deputy for economic development, Samir Mayekar, also said the mayor’s views on investment in the city were historic.
“Mayor Lightfoot is the first modern Chicago mayor to see the entire city, and I think her tenure will be a pivotal moment so that all future mayors see the entire city and keep investment flowing in transformative ways to all areas of the city” Mayerka recently told the Chicago Sun-Times.
Lightfoot touted Invest South/West in his farewell speech on Monday, calling out winners including Barrett and Patton as well as DL3 Realty’s Leon Walker, Emerald South Economic Development Collaborative’s Ghian Foreman, GMA Construction Group’s Cornelius Griggs, ALL Luis Puig of Masonry Construction Co. and related Midwestern companies.
Not only did the Related team with Patton’s firm win the Invest South/West package, but Lightfoot also this year reaffirmed the city’s commitment to Related’s massive development, The 78, between the South Loop and Chinatown. Scott Goodman, another developer with an $8 billion investment in a major lakefront development in Bronzeville on the site of the former Michael Reese Hospital, agrees that Lightfoot has changed the architectural narrative across the city.
“You really made sure that these communities got the attention and investment that they needed over the years,” Goodman told Lightfoot at the Bronzeville Lakefront project’s groundbreaking ceremony.
The outgoing mayor is sure to point out that not only is the plan a boost to the community, but developers will also stand out in deals struck with her administration. Their “high-impact real estate developments on the south and west sides” benefited from her plan, “creating thousands of jobs, housing units and services for residents, enabling upward mobility in thriving communities,” Wright said. Foote said.
The Chicago real estate industry’s overall perception of Lightfoot certainly isn’t good. Some have criticized the mayor’s ability to maintain working relationships with the business community, with Sterling Bay CEO Andy Glore this week blaming her office and lack of support for slow progress on the company’s $6 billion Lincoln Yards megadevelopment.
“She’s against development, which really baffles me because of the economic impact in terms of construction jobs, permanent jobs, and the ability to compete with other cities,” Glore told Bloomberg. “It’s between $8 and $10 billion [range] If you add it all up. “
Residential developers also must grapple with Lightfoot’s expansion of the city’s affordable housing ordinance in 2021, which doubles the proportion of affordable housing in most cases and requires 20 percent of total projects to undergo zoning changes.
While intended to increase the city’s affordable housing stock, builders say the change discourages new development by making it harder to complete new projects.
“Raising these requirements will just make it harder to build the housing that people want in Chicago,” Paul Colgan, a lobbyist for the Building Trades Association of Greater Chicago, recently told Illinois Answers Project. “Any project like this that doesn’t generate more housing, whether it’s affordable or market-rate, is bad. Because we’re losing tax revenue … all the economic impact of the building is gone.”
The developers did get help from state legislators in the form of property tax relief It was approved that same year, providing impetus to overcome the city’s higher standards.
Foreman, a longtime Southside developer, said development in the south and west had been slower than he expected, but he didn’t necessarily blame the Lightfoot government. He noted that bringing the city’s outlying areas into the center of Chicago’s development conversations was a dramatic shift from the past.
“You’re talking about a big institution. I’ve seen what the critics have said, and I think some of it is fair, some of it is unwarranted, but the problem is that attention is there,” Forman said.
