Charlie Shaw says Homan Square is “one of the most important inner-city projects in North America.”
Just on quantitative grounds, the president of the Charles H. Shaw Co., which is developing Homan Square in a joint venture with Sears, Roebuck & Co., can make a good case for the claim.
The project to put up some 600 new homes and spawn major new business development in economically and physically devastated North Lawndale-which lost half its housing between 1960 and 1990-is of a scale and scope that rivals any other single-site project under way in the country.
But the significance of Homan Square, in which Sears has promised to invest $30 million, could go beyond that.
For Shaw, as president of the Urban Land Institute-the organization of high-powered developers, financial institutions, planners and government officials that is the country’s leading private group promoting urban development-is also a role model.
If his development at the 55-acre former Sears headquarters complex should succeed, it could inspire similar large-scale projects to reclaim inner cities all around the country.
If it fails, it could be taken in Chicago and elsewhere as further evidence that money going to inner city redevelopment is just dollars down the drain.
“Homan Square is going to have a tremendous impact on a very devastated community,” said Chicago Department of Housing commissioner Marina Carrott, in words that will be as true in failure as in success.
The development comes at a crucial time.
On the one hand, more attention is focused on rebuilding America’s inner cities than at any time in the past 10 or 15 years.
Housing and Urban Development Secretary Henry Cisneros has expressed in speech after speech across the country a commitment to solving urban problem that hasn’t been heard at HUD for many years, although deficit reduction has curbed growth in the federal housing budget.
And the federal spending is being augmented as never before by hundreds of millions of dollars in private money from corporations, foundations and institutional sources.
On the other hand, there is a growing feeling in middle-class America that cities are dying from crime, drugs and technological obsolescence and are not much worth saving. Middle-class flight is draining Chicago, New York, Los Angeles and city after city in between.
“Cities have been abandoned by middle- and upper-income whites and by governments at all levels,” said Nicholas Trkla, president of Trkla, Pettigrew, Allen & Payne, one of Chicago’s best-known planning firms, at a recent Urban Land panel on the inner city.
“Some say the best we can do is slow down the process and that it’s best to let (the city) die gracefully,” he added. “There are huge problems and tiny resources. Can we (solve the problems)? Or should we sit back and let the cities die?”
With this background of crisis, cities in the 1990s have become the focus of a kind of desperate attention, and Chicago and Homan Square are right in the middle.
“It will be very visible nationally,” Shaw said.
For Shaw, whose development credits range from Lake Point Tower adjacent to Navy Pier to the Evanston/Northwestern University Research Park to the Garibaldi Square luxury home project on the Near West Side, saving the city is an imperative, not a question.
He claims that for 15 years he has been making himself unpopular at Indian Hill Country Club cocktail parties in Winnetka (where he lives) and on the commuter train to the Loop telling the North Shore elite they can’t run from the inner city because the two areas are inextricably entwined.
“Stabilizing the inner cities is critical to continuing the way of life we’ve known,” he said. “I see signs that the broader society is more and more beginning to recognize our destinies are interwoven and we’d better do something.”
Shaw has been doing something for about five years, since Sears chairman Edward Brennan asked him to look over the company’s former headquarters site extending around Homan Boulevard and Arthington Street.
The property had been falling increasingly into disuse since Sears in 1974 moved its headquarters to Sears Tower downtown.
Between that meeting with Brennan and now, when work on the first phase of 74 homes is finally getting under way, Shaw said he has met with hundreds of people to promote the project.
“I’ve personally spent more time with bureaucrats and community people than in all other projects combined in my 33 years of building,” said the 60-year-old developer.
Most recently his greatest efforts have been turned to interesting business and government leaders in the million-plus square feet of unused office and industrial space that will be spared demolition in the Sears complex.
He said his big coup so far has been persuading Ed Noha, chairman of CNA Financial Corp. and of Chicago’s Economic Development Commission, that Homan Square is the right spot for a federally-backed regional Manufacturing Technology Extension Center.
The federal government approved the commission’s plan for the center in November, earmarking $8 million as part of President Clinton’s Defense Reinvestment Conversion Initiative. The city and state are expected to chip in an additional $33 million, with more funds coming from private business sources.
The money will be used to develop a facility to give small and midsize businesses training and other assistance in using the latest technology, equipment and operating methods.
Shaw said he has also brought out business and civic leaders such as Material Service Corp. chairman Lester Crown, Peoples Gas chairman Richard Terry, Chicago School Finance Authority chairman Martin Koldyke, Cook County Board chairman Richard Phelan and officials of the Catholic Archdiocese.
“Nobody is going to come out here independently, so we’ve got to keep a bunch of things going at the same time,” Shaw said, comparing the approach to a circus performer keeping multiple plates spinning simultaneously.
Shaw acknowledged that most successful revitalization projects on this scale have been done in association with an institution, such as a hospital or university, that provides a natural stabilizer and an employment base.
“In these buildings, we have the opportunity to create an institutional base,” Shaw said, adding that he expects 100,000 square feet of business space to be filled by the end of 1994. But completing the business part of the development could take 10 to 15 years, he noted.
Job creation through business development is crucial to maintaining a market for the housing, said Shaw Homes executive vice president Frank Martin, who has immediate responsibility for the housing element of the project.
“It’s an overriding criterion to have the (business) buildings anchor the community and the new residents,” he said. “Our pace will be affected if we don’t have local jobs.”
Ald. Jesse Miller (24th), who represents North Lawndale, puts local unemployment at 45 percent.
Martin said that, in any case, the residential development will have to draw from a larger area than North Lawndale because there are simply not enough financially qualified buyers there even at the subsidized prices that will be offered.
Initial prices for the first group of 24 for-sale, detached homes (the other 50 units will be rental) are in the $80,000-$90,000 range after $33,000 in subsidies from the city’s New Homes for Chicago program and from Sears-which also donated and cleared the land-have been deducted.
The minimum family income for the cheapest house would be something more than $30,000, depending on interest rates.
“Even if only half the units are ownership housing, that’s 300 units, and we will have to bring people back to Lawndale,” Martin said, adding that he saw the potential market area as ranging from downtown to the near western suburbs.
To lure buyers, the Shaw Co. has a first-phase plan that devotes a quarter of the site to landscaped open space, including a play area and picnic area, with wrought iron fencing on the perimeter.
The single-family homes will have private yards, patios and attached garages.
Shaw believes getting middle-class homeowners back to the area so it will be economically integrated is the key to its salvation.
“All the people making over $25,000 a year have moved out, so the community hasn’t had the glue to hold it together. What there really should be is (widespread) homeownership,” he said.
The project, with its goal of economic re-integration for North Lawndale, has made some in the community suspicious, Shaw admits.
Residents who packed a meeting at Douglas Park fieldhouse last January expressed fears that the project was designed to bring in whites and the wealthy and would raise property taxes in the area.
“Years and years of neglect have created a fundamental mistrust,” Shaw said. “They see we’re spending millions and ask where’s our pot of gold at the end of the rainbow.”
“There is none for us,” he insisted. “The pot of gold is that this project can be a signficant factor in stabilizing a neighborhood. There’s no signficant profit here for us. That’s hard to understand.”
The Shaw Co. actually lost money on its first New Homes for Chicago project, a development of 40 homes just completed in the South Austin area.
Theft and vandalism-thieves ripped out copper piping, cabinets and appliances-plus unexpected costs for site cleanup accounted for the loss, Martin said.
Miller said early mistrust has been allayed, and commended Shaw and Sears for meetings they held to explain the project and seek community input.
He added that the community didn’t expect its housing needs to be satisfied by this project alone. “We hope this can be a jump start for all types of development.”
The Shaw people are clearly hoping the same. Martin said a key to Homan Square’s success will be if nonprofit groups and city and state agencies start developing more projects and making housing loans in the area.
Shaw, who has the developer’s ability to see brave new worlds where others see only ruination, tries to see North Lawndale’s positives as he whips around its rubble-strewn blocks in his beige BMW, pointing out its parks and its closeness to the lake, the Loop, the UIC campus and the Near West Side medical complex.
But when he sees young men hanging out on a street corner at mid-morning, his optimism takes a brief hit.
“This is what is sad,” he said.
Then he goes back to finding the good points, like a nearby block with most of the houses still standing-a rarity in an area that has has seen nearly 15,000 units of housing vanish in the last 30 years-and even well maintained.
“There’s rays of light,” he said. “Very few, but there are some.”
