Goodbye, Lincoln Yards megadevelopment of towering heights. Hello, Foundry Park, an idea for a new residential enclave on the North Side.
Developer Jim Letchinger said Thursday he will acquire, with Kayne Anderson Real Estate, the northern chunk of the former Lincoln Yards development site. The vacant 31 acres includes the old Finkl Steel property on Cortland Street along the Chicago River.
The buyers said the sale should close by the end of September.
Letchinger, CEO of JDL Development, said his plan will knit the Lincoln Park and Bucktown communities with construction that’s almost exclusively residential, with less than 3,000 units. It contrasts with the Lincoln Yards plan by Sterling Bay to line the riverfront area with office towers and high-rise homes, some in the 60-story range. It was backed by a city pledge of up to $1.3 billion in tax incentives.
“We’re really being respectful of our neighbors,” Letchinger said. He said a couple buildings might be in the 30-story range, but the rest will be under 20 stories. Early plans, to be finalized in talks with the city, call for a mix of housing types, even some single-family homes, with a dash of commercial space. The Foundry Park name rebrands a fallow site that became a civic quandary.
In their announcement, Letchinger and Kayne Anderson said, “The community will be a walking neighborhood, with tree lined, low traffic streets and new open green space that engages the river and offers a four-season recreational opportunity. Foundry Park will be a gathering and recreational place for all.”
Terms of the sale were not announced. The seller was Bank OZK, which seized the property from Sterling Bay after the leading Chicago developer couldn’t act on its ambitions.
Mayor Brandon Johnson’s office did not immediately comment.
Still in limbo is the southern portion of the 53-acre Lincoln Yards property that Sterling Bay had controlled for a decade. J.P. Morgan Asset Management has it with Sterling Bay and has yet to take offers, Letchinger said.
“We had hopes of obtaining it, but we don’t need it,” Letchinger said. “We have just a great opportunity with the north piece and we wanted to move that forward.”
He can build without a zoning change because he plans less density than what the city approved for Sterling Bay. Letchinger said he might work with the city on new zoning for the sake of clarity. Incentives for public improvements would be available, but how much remains to be negotiated.
Foundry Park recalls the site’s industrial heritage. The developers are using the address of 2001 N. Southport Ave. for the project.
Ald. Scott Waguespack (32nd), whose ward includes the Lincoln Yards site, said JDL has come up with “a plan that will work this time,” instead of an ambitious project that seemed “too big to fail,” but managed to do just that.
City planners have promised to “move forward as quickly as possible” to finalize a new redevelopment agreement for the site “in a few months as opposed to seven years,” he said.
“The opportunity is here now. Let’s do it with all haste. … Planning and Development knows it is a good approach — and we do too, definitely with this different approach on it that’s gonna bring housing and jobs,” Waguespack said.
The alderman praised a JDL approach that favors “more compatibility with surrounding neighborhoods.”
“We’re not doing a second downtown, which a lot of people decried several years ago,” he said.
Letchinger said he hopes to have renderings in a couple months. He promised a marked departure from the steel-and-glass emphasis of Sterling Bay.
His goal is to begin construction in about a year. “We will move very quickly. Time is deadly in real estate,” Letchinger said.
His firm is responsible for projects of increasing complexity in recent years. His record includes two residential towers over a commercial podium at Chicago Avenue and State Street and the master planned redevelopment of Moody Bible Institute properties on the Near North Side. Letchinger has delivered three buildings on the Moody Bible sites with two more in the works.
He said about 20% of the units he builds at Foundry Park will be marketed as affordable, meeting terms of a city ordinance, but details have to be worked out.
Florida-based Kayne Anderson Real Estate is part of a $38 billion investment firm with assets that include medical offices and student and senior housing.
In the announcement, Kayne Anderson Real Estate CEO Al Rabil called Foundry Park “one of the strongest buying opportunities in our firm’s history,” one that diversifies its holdings.
Sterling Bay’s grandiose plans collapsed as inflation, high interest rates and COVID-19 body-slammed construction plans.
Ciere Boatright, the city’s planning commissioner, noted in May that Sterling Bay wanted “two Willis Towers’ worth of office space,” even though companies have scaled back since the pandemic.
Boatright declined Thursday to comment on the new proposal. A planning department spokesman said the agency met with JDL July 3 to “discuss high-level land use considerations” and will have another conference later this month.
City subsidies may be available from a tax-increment financing district that covers the development site and nearby property. Waguespack said the smaller scale of Letchinger’s proposal should mean he will need less city help than Sterling Bay demanded. Then-Mayor Rahm Emanuel muscled that agreement through the City Council shortly before leaving office in 2019.