A planned project to develop the U.S. Steel South Works property will result in a 20,000 home community if all goes well through a five-month due diligence process.
Financial details for Emerald Living‘s successful bid for the 440-acre site were not publicized in the Aug. 1 news release, although Crain’s has reported that the transaction could be worth between $55 million and $80 million, and it could ultimately require $3.5 billion to complete over decades.
The project will be named New SouthWorks, with plans for mixed-use development, with opportunities for commercial retail and office spaces, taking advantage of the extensi ve lakeshore frontage and views of the Chicago skyline.
“This agreement is a major milestone towards converting an unused stretch of land that represents Chicago’s industrial past into a vibrant community that will contribute to Chicago’s economic, cultural and recreational future,” Mayor Rahm Emanuel said. “I look forward to seeing the community’s dynamic vision for this site become a reality.”
“We are excited by the tremendous opportunity available at the South Works site and look forward to working throughout this due diligence period to determine the best path forward,” said Barry O’Neill, CEO of Emerald Living. “Over the coming months, we will be working with the city, Ald. Sadlowski Garza and Mitchell, local community members, and other stakeholders to develop a new, exciting vision for this site and the surrounding South Chicago neighborhoods.”
The site will have a substantial residential component of up to 20,000 housing units built with innovative, environmentally-friendly technology pioneered by Emerald Living’s partner, Barcelona Housing Systems (BHS).
“This technology provides an industrial platform for large-scale housing construction, enabling rapid site assembly with high-quality materials, while promoting green technology, environmental sustainability, and community living,” said Cesar Ramirez Martinell, founder of BHS.
Under the terms of the PSA, Emerald Living has five months to close on the sale following a period of environmental review and other due diligence required on the site.
Emerald Living is part of WElink Group – which describes itself as an international low carbon technology company specializing in renewable energy delivery and low carbon modular housing solutions. This is its first signature development in the U.S.
There will be significant challenges in achieving the developers’ vision, as the surrounding area has experienced depopulation, high crime and declining property values.
However, Crain’s reports Chicago developer Dan McCaffery believes the project may ultimately be viable, even after he failed (after nearly 12 years) in his own initiative to develop South Works. “He and Pittsburgh-based U.S. Steel broke off a joint venture last year, abandoning a plan that called for more than 13,000 homes, 17.5 million sq. ft. of commercial space and a 1,500-slip marina,” Crain’s says.
McCaffery still believes in the site, even though he didn’t build a single thing on it. He even envisions millennial professionals leaving downtown and moving their young families there, attracted by its affordable housing. “It’s irrational to think that because people left the South Side there’s no turnaround coming,” he says. “In a strange way, I just have a feeling that it will be a lot quicker to develop than most people do.”
Back in 1992, few people predicted the property would be vacant a quarter-century later.