Chicago’s Latest Megadevelopment? Lawmakers Boost One Central
Updated June 26
One Central: the who, what, where
One Central would be the biggest of them all, at least in terms of investment, which is pegged at $20 billion (that’s three times the price tag of Lincoln Yards). The new neighborhood would be built south of the Loop on what would normally be prime real estate — 34 acres of open space encircled by Roosevelt Road, the South Loop neighborhood, McCormick Place, Lake Shore Drive and Soldier Field.
The challenge: that land is covered by a train yard.
Enter Wisconsin-based developer Bob Dunn. His company, Landmark Development, controls the air rights above the tracks, and he’s proposing a cluster of skyscrapers be built on a “table top” above those tracks. Landmark considers the project the largest single real estate development in the history of Chicago and promises to “remove urban blight along the lakefront.” A study commissioned by the Chicagoland Chamber of Commerce concludes the development would create tens of thousands of jobs and $120 billion in tax and fee revenues for the city and state over 40 years.
In addition to housing, hotels, entertainment and commercial space, Dunn wants to build a multimodal “transit hub” on the site that would pull together local, regional and national train lines (CTA, Metra and Amtrak), and he wants government help to do it. That part of the project just got a big boost from Illinois lawmakers.
Illinois lawmakers approve plans to buy transit hub
In the final hours of the legislative session, lawmakers approved the broad outlines of a plan for the state to purchase the One Central transit hub — once it’s built — for a total of $6.5 billion, with payments beginning July 2023 and continuing for 20 years. (That price represents a 70% markup over Dunn’s cost of development, which the law caps at $3.8 billion. Dunn claims that by the time the state buys it, the transit hub will be worth $10 billion, so the state is actually getting a bargain.)
Lawmakers passed the deal lickety-split. The language was handled by legislative leaders and Gov. JB Pritzker’s office. Local lawmakers, who had been talking to South Loop constituents about a host of One Central concerns, said they were left out of the process. “I kept thinking, ‘There’s gonna be a bill, there’s gonna be a bill,” freshman state Sen. Robert Peters said. No bill. Instead, in a highly unusual move, the One Central language was added to the budget implementation bill, a must-pass technical device used to fund all of state government. “Which then meant there’s no way I could vote yes or no” on One Central, Peters said.
The law allows Pritzker’s administration to negotiate an agreement with Dunn for the transit hub’s purchase without any further legislative input.
The governor’s office said Pritzker has not committed to developing the project, and the language passed so far doesn't cost the state anything. Money to pay Dunn for the “development, financing, construction, operation, and management” of the transit hub would come from sales tax revenues potentially generated by the development itself. “These are proceeds that would not have otherwise been realized without the existence of the development,” said Emily Bittner, a spokeswoman in the governor’s office. She indicated the specific payment amounts set up by the legislation could change.
Dunn has called the deal “the opposite of a subsidy.” He said the state’s increased tax revenue will more than cover the purchase price and suggests owning the transit hub will give the state a steady income from parking fees, leases and concessions.
Lightfoot: “I'm not sure that having a transportation hub in that area is a priority”
The legislation allows Dunn to go after federal funds to help finance the transit hub. If he gets them, Illinois would get a price break on its purchase of the hub.
The governor’s office said the payment schedule in the law “is merely an outline of what the payments might look like under an agreement,” and the schedule was required by the federal government in order for Dunn to go after the Railroad Rehabilitation and Improvement Financing.
Meanwhile, the city would have to approve any actual development, and Chicago Mayor Lori Lightfoot has seemed cool to the One Central project.
“I have questions as to whether or not we need a transportation hub,” Lightfoot said when asked last week about the impact of the state legislation. “They're going to have to make the case, and they're going to have to go through a rigorous community process.”
As a candidate, Lightfoot was critical of megaprojects, arguing for more community input and for developments that benefit the neighborhoods. One Central could be a test of those ideals.
Lightfoot says she’s told One Central developers “they have to go through the normal Department of Planning process, and there are not going to be any shortcuts in that.”
Of course, that normal planning process has greenlighted two other megadevelopments this year.
The alderman in the area, Pat Dowell, 3rd Ward, said the new state legislation changes nothing. She has kicked off a series of “workshops” — with Dunn in attendance — to give community members input into the plan. “I don’t feel any pressure from what actions the state took,” she said. “We’re going to do our job at the city level to review the merits of the proposal.”
What about environment, affordable housing?
One Central has generated a host of concerns.
“It’s on the lakefront, it’s over train tracks, what is the environmental impact of doing such a development?” asks state Sen. Robert Peters. He wants independent impact studies on this and also on the economic impact. He said he doesn’t want the city to end up with half-empty luxury housing or a white elephant.
He suggests 50% of the housing in the project should be affordable to low- and moderate-income Chicagoans.
Peters also wonders if a transit hub is a solution to a manufactured crisis. “I think oftentimes we’ve seen in the last 30 years this sort of creation of crisis and then someone with a lot of means saying, ‘I have a solution for a thing nobody asked for,’” Peters said. “So is the transportation hub just a crisis that’s there so that the profit margins can go up?” No transit agencies have asked for or endorsed the transit hub yet.
The state representative from the area, Kam Buckner, said One Central adds investment in areas already flush with it.
“We’ve got to ensure that we are looking at Chicago in a very holistic way, and not … just putting things certain places where they’ve always been because that’s the way we’ve always done it. The entire city deserves to thrive,” said Buckner. “We need to diversify investment in all our neighborhoods — that’s a real thing.” This project doesn’t do that, he said.
Buckner has been meeting with constituents, many of them well-heeled South Loop condo dwellers who could lose their lake views if skyscrapers pop up between them and the lake. Residents are worried that a congested area will grow more congested.
Buckner said his goal is not to oppose the project itself, but he wants to make sure constituents’ concerns are heard. He said the megadevelopments in Chicago have surprised him.
“It’s curious that this is the way that Chicago is going, especially since by all accounts we’re losing population, but we’re building more and bigger neighborhoods, “said Buckner. “Maybe we really did take Daniel Burnham literally by making no small plans, but this is where we are now.”
Linda Lutton covers Chicago neighborhoods for WBEZ. Follow her @lindalutton.
Update: This story has been updated to clarify the governor's position on the One Central development.