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Soil contamination pumps the brakes on sprawling South Works megadevelopment

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The ambitious lakefront project calls for 20,000 modular homes

A rendering of the New SouthWorks conceptual masterplan.
Barcelona Housing Systems

A plan to redevelop U.S. Steel’s 440-acre former South Works site is facing a new soil contamination issue. As a result, the mixed-use Far South Side megaproject is “on hold,” according to a recent report by the Chicago Tribune.

First revealed in early 2017, the New SouthWorks project from Irish-based Emerald Living and partner Barcelona Housing Systems outlined 20,000 new homes arranged in 32 Spanish-style superblocks. In addition to the thousands of planned residences, preliminary plans on Barcelona Housing Systems’ website show new retail, green space, office space, and an on-site modular home factory.

The latest environmental concerns come years after landowner U.S. Steel undertook extensive, EPA-supervised remediation after the plant closed in 1992. Today little of the original industrial complex remains save for a central canal, the ruins of the half-mile-long “ore walls,” and the mystery contaminant holding things up.

The former plant’s canal and overgrown ore walls.
Jay Koziarz

The New SouthWorks project isn’t the first ambitious redevelopment plan at 8080 S. Lake Shore Drive to run into trouble. In 2004 developer McCaffery Interests teamed up with U.S. Steel on multi-phase mixed-use endeavor estimated at $4 billion. That partnership dissolved in 2016 without a single new building developed at the sprawling lakefront site.

City Hall appeared considerably more optimistic regarding the current plan from Emerald Living and Barcelona Housing Systems. In August of last year, Chicago Mayor Rahm Emanuel announced that a preliminary Purchase and Sale Agreement had been reached between the landowner and the development team.

Unless the contamination issue can be corrected, the pending sale—as well as the future of the massive South Works site—could be in jeopardy.

Update: According to a follow-up report published by Crain’s, developer Emerald Living remains “very committed to the New South Works project.” The Irish-based company went on to point out the diminished role Barcelona Housing Systems has played in the process since late 2017.

“The due diligence with respect to all commercial, legal, and environmental aspects of the project was handled exclusively by Emerald Living,” read the company’s statement in Crain’s. “BHS stepped back completely from New SouthWorks at that point and have not played any role in the project since.”

Barcelona Housing Systems
Barcelona Housing Systems