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40 Acres Of Vacant Land Hold The Key To The Future Of The Illinois Medical District

The fencing around a 9.5-acre site at the corner of Ogden and Damen avenues and Harrison Street is wrapped with promises of a brighter future for the Near West Side. The site will eventually be home to over 1M SF of office, retail, apartments and a hotel as part of Higgins Development's IMD Gateway project, and is the first major non-healthcare development in the Illinois Medical District.

The site of Higgins Development's IMD Gateway project in the Illinois Medical District
The site of Higgins Development's IMD Gateway project in the Illinois Medical District

IMD Gateway's success will determine the future of real estate activity within the IMD's borders. The district measures 560 acres, and is home to Rush University Medical Center, Cook County's Stroger Hospital, the Jesse Brown VA Medical Center and UIC Medical Center, along with UIC's medical schools campus.

The IMD has roughly 40 acres of undeveloped land that was being reclaimed by nature before the arrival of Executive Director Dr. Suzet McKinney in September 2015. McKinney recognized that developing this land could serve the IMD's mission of being an economic generator for Chicago, Cook County and Illinois, while complementing the missions and real estate activities of the four anchor hospitals. Leveraging this land via ground leases (Higgins Development signed a 75-year ground lease with the Illinois Medical District to develop the IMD Gateway site) is beneficial for the IMD, which, as an organization of local government that operates independent of state funding, generates income from its operating activities, primarily real estate.

Illinois Medical District Executive Director, Dr. Suzet McKinney
Illinois Medical District Executive Director Dr. Suzet McKinney

McKinney organized a team of stakeholders to put together a master plan last year to develop the vacant land, and serve as a guide for the real estate activities of the four anchor hospitals and redevelopment efforts. She sees projects like IMD Gateway and the Cook County Hospital redevelopment as essential to the IMD's goal of creating a synergistic environment of private, governmental and nonprofit institutions, businesses and organizations across healthcare, science, technology and education. McKinney envisions the IMD eventually being a medical district on a par with Houston's Texas Medical Center, which is three times the size.

The IMD further indicated it was serious about leveraging its real estate by opening a request for proposals process last year to hire a real estate adviser. CBRE Senior Vice President Matthew Dobry said it was immediately apparent that the IMD was not marketing itself well for development. The plan that he and Senior Vice President Geoff Euston submitted to the IMD centered on five services it could provide to help the IMD fulfill its real estate goals: real estate adviser services, marketing, asset management, asset leasing and development advisory services. CBRE was named the real estate adviser for the IMD late last year.

McKinney said the IMD and CBRE look at development opportunities on a case-by-case basis to find the best approach to development or redevelopment.

An ambulatory facility being built by Cook County Hospital in the Illinois Medical District, at Ashland Avenue and Polk Street.
An ambulatory facility being built by Cook County Hospital in the Illinois Medical District, at Ashland Avenue and Polk Street.

That partnership proved immediate dividends: Cook County Health & Hospital Systems started construction last December on a nine-story, 288K SF ambulatory health center. McKinney said the ongoing trend of hospital systems adding more ambulatory services is essential for the IMD's growth and addressing the needs of its patients. Discouraging the use of emergency rooms from being a primary source of care in favor of ambulatory centers saves money long term. Rush University Medical Center is also building a new ambulatory center at Harrison and Ashland, on a site that formerly was student housing.

The IMD is also assessing its infrastructure needs. It is working with ComEd to improve the district's power grid so the hospitals — which are critical infrastructure — are not affected by an outage. It is also discussing with CTA ways to improve public transportation to and inside of the IMD. CTA is renovating the IMD/Damen Avenue Blue Line 'L' station and a plan to modernize the aging Blue Line's Forest Park branch is picking up steam, which would more reliably transport patients to the IMD. Shuttle services currently connect the hospitals in the district.

Shuttles and increased bus and train service may solve a growing parking problem. McKinney said 80,000 patients visit the IMD daily, but the district only has 20,000 parking spots.