It’s just a matter of time before we see many of the major industrial sites along the Chicago River’s North Branch be completely reshaped by developers. One of the largest zoning changes in recent history, the Chicago City Council approved the plan to reshape many of the Planned Manufacturing Districts (PMDs) that line the banks of the North Branch just north of Chicago’s central business district. The ordinance was passed by the city’s governing body just two weeks ago, and already, some developers are preparing to make big moves.
So, who owns what along the Chicago River’s North Branch? Developers like R2 Companies has staked its claim on Goose Island while Sterling Bay is moving in on nearby sites just north of Goose Island. However, there are still many smaller properties owned by independent businesses and landlords, reps with the brokerage KIG CRE tell us. This is especially so on the southern end of the North Branch PMD that runs adjacent to Goose Island.
“There’s a lot of discussion about who’s making moves, but there’s been no portrait of who owns what,” Jacob Albers a data analyst with KIG says. “[The North Branch corridor] is one of the last large land banks in the city of Chicago and where we’re at in the development cycle, it was really only a matter of time until we saw movement there. And for the city, it’s an opportunity to build a big tax base.”
As a primarily industrial corridor, a graphic depicting property ownership along the North Branch provided by KIG shows very little to no residential ownership across the large stretch of land that lines the Chicago River. However, this is expected to change in the coming years as the new North Branch ordinance adopted by the city loosens up restrictions to mixed-use development such as residential and retail.
Already, developer Belgravia Realty Group has proposed hundreds of new residences for a 4.5-acre piece of the industrial corridor. However, no other player has been as bullish on the shifting North Branch than the Fulton Market-based developer Sterling Bay. Last year, the developer paid $140 million for the sprawling 28-acre former home of A. Finkl & Sons steel, and this year, the developer is set to close another major deal, this time paying $105 million for an 18-acre site that housed the city’s Department of Fleet Management.
Sterling Bay’s land grab is reminiscent of what the developer has done in the West Loop—scooping up major industrial plots to redevelop for mixed-use. And as Sterling Bay assembles the pieces of its North Branch empire, the developer appears to be ironing out details on site specifics behind the scenes.
“They’re in a sense doing a similar play as they did in the West Loop, which was very lucrative for them,” KIG managing partner Todd Stofflet says. “They’re trying to assemble as much land as they can so they can build and sell the product type that corporate clients like.”
A map from KIG helps to illustrate just how much property along the North Branch that Sterling Bay has acquired in recent months.
While Sterling Bay has been behind major corporate projects in the West Loop, it’s still not exactly clear what the developer plans to do along the North Branch and whether or not we’ll see new corporate campus type developments along this property. The developer is known for overhauling the former Fulton Market Cold Storage facility in the West Loop and turning it into a major mixed-user that Google’s midwestern operations and SRAM, a local bicycle component fabricator, call home. In addition, Sterling Bay is currently working on a new West Loop development which will become the global headquarters for McDonald’s.
“We don’t know what they have planned, but [corporate campuses] would certainly make a lot of sense,” says Stofflet. And in terms of infrastructure improvements—which are much needed along this stretch—Stofflet suggests that we may see some private-public partnerships for infrastructure updates in the near future. “The North Branch Industrial Framework Plan includes 5-, 10-, and 20-year benchmarks for infrastructure improvements,” Albers adds. “There are different ideas for what they want to get done during those periods.”
And in terms of which sites we should be keeping an eye on, Albers and Stofflet suggest properties like the General Iron site, the Greyhound site, the Tribune sites, and the smaller, independently owned properties near North Avenue could be the next industrial parcels to change hands or see new proposals in the coming months. And with the sweeping zoning change that affects 760 acres of land along the industrial corridor being a done deal, we can expect to see many more moves being made in the near future.
- Chicago City Council approves sweeping North Branch zoning ordinance [Curbed Chicago]
- Chicago Plan Commission OK’s transformative North Branch initiative [Curbed Chicago]
- Chicago Plan Commission votes to loosen North Branch zoning restrictions [Curbed Chicago]
- Hundreds of residences planned for former industrial stretch of North Branch [Curbed Chicago]
- Open thread: What kind of new development makes sense for Chicago’s North Branch? [Curbed Chicago]