Why The Lower North Branch Corridor May Be Developed Before Sterling Bay Breaks Ground At Finkl
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At 760 acres, the North Branch Industrial Corridor is a developer's dream, and the zoning changes approved by City Council last month are the most significant in Chicago since the first planned manufacturing district, the Clybourn Corridor, was established in the 1980s. Although they are grabbing headlines, the most interesting section of the North Branch may not be the Finkl Steel site or Goose Island.
KIG CRE Managing Partner Todd Stofflet said the zoning changes will likely have the fastest impact along the North Branch's lower portion, an area bordered by the Chicago River to the east, Kinzie Street to the south and Halsted Street on the west.
Stofflet said activity in the North Branch's lower portion is a great way to unlock development between River North, West Town and the Near North Side. The intersection of Halsted Street and Chicago Avenue borders the three neighborhoods.
The North Branch's lower portion contains the largest tracts of land not controlled by developers (pictured in green, developer-controlled parcels are in gold). Many of these parcels are large, contiguous sites that could serve as the foundation for larger, mixed-use developments.
KIG CRE Data Analytics Associate Jacob Albers said that, besides Tribune’s reported partnership with Riverside on the northern Tribune parcel, developers have only a smattering of smaller sites in the lower North Branch. Sites like Tribune Media's Freedom Center press plant remain question marks as to who will buy them and how they will be redeveloped. The contiguous nature of these sites may also allow developers to get started sooner than some sites along the North Branch's upper portion, because these portions are ready for development without assemblage.
What is known so far: Riverside Investment and Development has big plans for a seven-acre site at 700 West Chicago, the largest developer-controlled site in the North Branch's lower portion. Whether those plans are the ones briefly leaked online last month or something else entirely remain to be seen. Stofflet said the leaked renderings lead him to believe Riverside is leaning toward mid-rise development, which would complement the scale of similar buildings immediately west of Halsted in West Town.
The Riverside-controlled site is directly across the street from 600 West Chicago, the former Montgomery Ward catalog warehouse that is best known as Groupon's HQ. Albers said there is plenty of space for a corporate campus along the lower North Branch. Unlike Goose Island, which R2 Cos. has invested a lot of time and equity to transform into a corporate campus, or the C.H. Robinson HQ that Sterling Bay is building in the upper North Branch, the lower North Branch has greater flexibility in terms of both zoning and parcel size to accommodate a wide variety of development types.
Another site to keep an eye on is the Greyhound bus maintenance facility on Halsted, which JLL is marketing to potential buyers. Stofflet said this site is attracting a lot of interest from residential developers who would want to do high-rise to maximize density. Ultimately, community groups, aldermen and tract size will determine what will be built on these sites. Depending on the land price, construction costs could limit the type of development that is feasible.