REPORT: Plans For Lincoln Yards Come Apart As Deal To Sell Off Site Comes Together
JDL Development is reportedly in talks to acquire the remainder of the stalled Lincoln Yards development site after entering into a tentative contract with Bank OZK for the northern tract of land earlier in May.
The Chicago developer is working on a deal to buy the southern portion of the proposed Lincoln Yards land along the North Branch of the Chicago River from a joint venture of J.P. Morgan Asset Management and Sterling Bay, Crain's Chicago Business reports, citing sources familiar with the negotiations.
The move would shake up the future for the 53-acre plot that had been slotted for transformation into a $6B sea of commercial and residential skyscrapers under Sterling Bay's direction.
The sale prices for the southern portion of the land isn't clear, but sources told Crain's JDL offered between $55M and $60M for the site, with financial backing from Kayne Anderson Real Estate. Kayne Anderson was reportedly mulling the idea of injecting capital into the dormant megaproject last March.
JDL Development is also negotiating with Bank OZK to purchase the northern portion of the site, which the bank took over from Sterling Bay in March. The bank transferred its $84M valuation to its foreclosed assets, and a sale should result in “substantially no gain or loss,” the bank wrote in a filing with the Securities and Exchange Commission.
The price tag for both of JDL's acquisitions would come in around $140M.
Bank OZK entered into a tentative agreement for the northern tract of land on May 2, and the contract is “subject to typical due diligence and closing conditions,” according to the filing. If the deal goes through, the close should be on or before Sept. 30.
While under contract with Bank OZK, JDL has a window to fundraise, assess the land and gather input from the city government on how its plans for the site fit within Chicago's guidelines and what the city council might approve.
Alderman Scott Waguespack of the 32nd Ward previously told Crain's that he had a preliminary conversation with JDL CEO Jim Letchinger and believes JDL understands “the market won’t bear what Sterling Bay was trying to do.”
Sterling Bay has had years of difficulty securing the financing needed to develop the site.
Although it might take a good amount of time for JDL to negotiate a new agreement with the city government over what infrastructure costs it will be responsible for, Waguespack told the outlet he is “hoping not to delay it for two or three more years by going back through a whole new process.”
