Lori Lightfoot’s real estate legacy: A new view of the city
When it comes to private investment in Chicago, the money has historically flowed north. Changing that, with her focus on encouraging development in underserved communities in the South and West sides, will be Mayor Lori Lightfoot’s legacy, local developers predict.
Chicagoans denied Lightfoot a second term on Feb. 28, ultimately granting Cook County Commissioner and former Chicago Teachers Union organizer Brandon Johnson the city’s top job after the April 4 runoff. But developers who benefitted from her signature community development initiative, Invest South/West, say Lightfoot’s impact on real estate will be felt for much longer than the four years she spent in office.
“When it comes to economic and real estate development, absolutely there’s always been a focus on [downtown]; first it was the Loop, then it became the South Loop, then it became the West Loop, but under her administration it’s the entire city,” Imagine Development Group’s Torrey Barrett said. “And it’s been needed, because you have Black and brown developers who just needed the same chance that our counterparts have been having for decades.”
Lightfoot’s three-year plan to pour $750 million in public funds into neglected neighborhoods and corridors has financed projects from Barrett and other developers that include affordable and mixed-income housing units, commercial and retail spaces and solar-powered warehouses.
548 Development’s A.J. Patton said the strategy elevated minority-led firms that might not have done large-scale projects without city backing.
“There has not been a mayor who’s been more intentional about inclusive development,” Patton said. “She laid the groundwork for what inclusive development looks like. Not just contracting and labor; development co-ownership, full ownership.”
Samir Mayekar, Lightfoot’s deputy for economic development, has also said the mayor’s view of investment in the city is historically significant.
“Mayor Lightfoot was the first modern Chicago mayor who saw all of the city, and I think her tenure will be a pivotal moment, so that all future mayors see all of the city and keep investment flowing in transformative ways to all areas of the city,” Mayekar recently told the Chicago Sun-Times.
Lightfoot touted Invest South/West in her farewell speech on Monday, shouting out awardees including Barrett and Patton along with DL3 Realty’s Leon Walker, Emerald South Economic Development Collaborative’s Ghian Foreman, GMA Construction Group’s Cornelius Griggs, A.L.L. Masonry Construction Co.’s Luis Puig and the firm Related Midwest.
Not only did Related team with Patton’s firm to win an Invest South/West package, but Lightfoot this year also reaffirmed the city’s commitment to Related’s megadevelopment between the South Loop and Chinatown, called The 78. Scott Goodman, another developer with an $8 billion multi-phase lakefront megadevelopment on the site of the former Michael Reese hospital in Bronzeville, agreed Lightfoot changed the narrative on building across the entire city.
“You really made sure the neighborhoods are getting the attention and the investment they’ve needed for so many years,” Goodman told Lightfoot at the groundbreaking ceremony for the Bronzeville Lakefront project.
The outgoing mayor was sure to point out it wasn’t just the neighborhoods boosted by the program, but developers are also set to come out ahead on the deals they struck with her administration. Their “high-impact real estate development on the South and West sides” benefitted from her program and “created thousands of jobs, housing units and services for residents so they can achieve upward mobility in a thriving neighborhood,” Lightfoot said.
The Chicago real estate industry’s overall view of Lightfoot certainly isn’t all sunny. Some have criticized the mayor’s ability to maintain working relationships with the business community, and Sterling Bay CEO Andy Gloor this week blamed her office and lack of support for the slow progress on the firm’s $6 billion Lincoln Yards megadevelopment.
“She fought the development, which is so puzzling to me because the economic impact in terms of construction jobs, permanent jobs and the ability to compete with some other cities,” Gloor told Bloomberg. “It’s in the $8 to $10 billion [range] if you add it all up.”
Residential developers also had to contend with Lightfoot’s 2021 expansion of the city’s affordable housing ordinance, which doubled the percentage of affordable units to require 20 percent of a project’s total to get a zoning change, in most cases.
While intended to increase the city’s affordable housing stock, builders have said the change discourages new development by making it harder for new projects to pencil out.
“Ratcheting up these requirements simply makes it difficult to build housing that people need in Chicago,” Paul Colgan, a lobbyist for the Building Industry Association of Greater Chicago, recently told Illinois Answers Project. “Any program like this that does not produce more housing, be it affordable or market rate, is bad. Because we’re losing the tax revenue…all the economic impact of that construction is going away.”
Developers did get help from state lawmakers in the form of property tax breaks approved the same year, offering a boost to get over the city’s higher bar.
Foreman, a longtime South Side developer, said headway on South and West side development has been slower than he would have wanted, but he didn’t necessarily blame Lightfoot’s administration. And bringing the further-flung parts of the city into the center of Chicago’s development conversation is a big shift from the past, he noted.
“You’re talking about a big institution. I’ve seen what the critics say, I think some of that is fair and some of that is unwarranted, but the thing is that attention is there,” Foreman said.
