The 78, Reportedly One Of Amazon's Top 5 HQ2 Sites, Not Fazed By The Loss
The city of Chicago is on the cusp of a new era. A collection of mixed-use communities with parks and green spaces will soon rise on the edges of its downtown, bringing a massive expansion of its office market. Those new neighborhoods, such as Sterling Bay’s Lincoln Yards development on the North Side and Related Midwest’s The 78 in the South Loop, were some of the chief attractions for Amazon in its hunt for an HQ2 site.
But the failure to land the office market’s biggest fish will not slow down the urban core’s transformation. With a research and business incubator creating the high-tech impetus HQ2 won't, The 78 in particular is forging ahead undeterred.
“When Amazon came along, it seemed to fit our site perfectly,” Related Midwest Vice President of Development Michael Ellch said. The company plans to create a 13M SF mixed-use development over at least a decade. Amazon wanted about 8M SF, and the years of planning that preceded this request allowed Related to show a fully realized master plan that illustrated just how an anchor tenant would fit into a true neighborhood with riverfront walkways and green space.
“It stood out from many other [Amazon HQ2 proposed] sites, which were just large pieces of vacant land,” Ellch said. “We were definitely the finalist for Chicago and one of the final five sites in the country.”
But as Related officials were dreaming up The 78 long before Jeff Bezos announced the search for HQ2, failing to win the contest hasn’t caused anyone to lose sleep.
“I think Amazon’s interest justified our belief in the site,” Ellch said. Throughout the process, “the bones of the master plan stayed the same.”
A key component of the plan could spark growth in the region’s high-tech industry and make The 78 much more than a new office park. Related Midwest and the University of Illinois have proposed a $1.2B public-private research center called Discovery Partners Institute, a move inspired by the King’s Cross development in London, where a sister company of Related set aside space for the University of Arts London.
“We found that a school on-site provides a lot of energy and creativity,” Ellch said.
But the Chicago institute will do more than teach. The university and Related envision bringing as many as 2,000 students from around the world each year to work with a variety of companies, as well as university professors doing research, on developing new products.
Infrastructure work for The 78 will begin soon, and Related is looking for other anchor tenants. Ellch said the project doesn’t necessarily need a corporate behemoth like Amazon to break ground, as long as the smaller users are the kind that attract ancillary users.
“We could be underway a year from now on up to 3M SF.”