The beast is back.
Having snoozed for nearly a decade, Chicago’s downtown real estate market is on its feet again, bellowing like a drunken Cyclopsi.
This scares younger cityphiles who have not witnessed, up close, the ferocity of the thing. Like those thirtysomethings who think the stock market began yesterday, they know not the pride that goes before the fall. They have not seen the splendor of the groundbreakings followed by the wailing at the foreclosure proceedings.
But the beast is back. The whole vainglorious spectacle is upon us once more, forcing everyone who loves the city to ask whether we’ve learned anything since the last time the creature was afoot . . . and forcing the candid among us to admit that, no, we probably have not.
Last week The Walt Disney Co. jumped on the thing’s back, announcing it will build an indoor electronic theme park–the company’s biggest attraction this side of Orlando–on the corner of Rush and Ohio Streets. Virtual Mickey on Rush Street!
The week before, it was developer Daniel McLean reviving plans to erect a city-within-a-city on six square blocks between Navy Pier and Michigan Avenue. Originally it was to be called Cityfront Center (before the giant dozed off around 1990). McLean plans to revive it as the mostly-residential River East. Pass the chardonnay!
And those are just the two-week highlights.
For several months now, signs hawking “Condominiums For Sale” have been going up on the older, half-empty office buildings of the South and East Loop. Farther out, nearly every vacant factory and warehouse within walking distance of downtown is being “lofted out,” as the developers put it.
The giant has changed clothes, however.
Instead of the soaring corporate office towers that jostled for space along Wacker Drive and LaSalle Street, this boom radiates from North Michigan Avenue with luxury hotels, multiscreen cinemas, cultural edifices, vertical shopping-and-dining malls and more types of housing than you can shake a fern at. So far this year, Chicago has issued twice as many housing permits as Naperville. That’s a bigger lead than the Astros have over the Cubs. And Naperville is in second place.
So what’s going on here? Is not this growth good for the city? And if so, what’s the problem?
Here’s where a little experience comes in handy. Your Monday maven once tracked the beast for this newspaper’s city desk–during the rip-roaring ’70s and ’80s. The creature last bestirred itself in 1969 with the opening of the John Hancock Building. Twenty years later, by the time it got overbuilt and collapsed for lack of tenants, Chicago’s downtown had doubled in size. Those were glory days, filled with stories of beauty and blight, of fortunes made and deals gone bad.
And when it was all over, this is what I had learned about the beast:
– It doesn’t last. Forget what the real estate touts are saying about long-term trends, back-to-the-city Baby Boomers and all that. This market’s appetite for loft apartments and 24-screen cinemas will be sated in a matter of two or three years. The beast will then yawn and disappear for who knows how long, leaving certain banks, pension funds and insurance companies holding the bag. Later it will rise, with a new set of clothes, and do it all over again.
– This boom-and-bust cycle, to which the downtown real estate market is hopelessly wedded, is not such a bad thing. A few mortgage lenders get hurt at the tail end (typically foreign banks unwise in the ways of the creature) but these down periods, in theory, give city planners time to regroup and get ready for the next awakening.
– Chicago’s planners, however, tend not to prepare for the beast’s fits and starts, much less its changes of clothing. The last lull would have been a good time to rewrite the city’s 40-year-old zoning ordinance. That didn’t happen. So planners now must tame the beast using a rule book written to limit the height and mass of office buildings. Little guidance will be found therein on how best to plan for come-and-go attractions such as electronic Disney. (If the city isn’t careful, the Chevy Suburbans will be backed up all the way to the Kennedy Expressway off-ramp.) Nor do the zoning maps specify how many parking spaces ought to be required of the soon-to-be lofted-out office buildings in the Loop.
– The beast, untamed, knows only to maximize profits and externalize problems. It’s City Hall’s job to channel, though not chill, the creature’s energy so as to create a cityscape that will serve the needs of Chicagoans long-term. Disney can’t be allowed to bring River North traffic to a standstill any more than McLean’s condo towers can be allowed to throw a six-month shadow across the waters of the Ogden Slip.
– These cautions notwithstanding, the beast’s awakening should be cause for joy among all who love the city. More and more it’s the downtown engine that pulls the neighborhood train. Virtual Mickey may not be real Chicago, but the out-of-towners will pay the city’s 7 percent amusement tax and 9.75 composite sales tax. That money will help trim trees and lay sewers from Rogers Park to Roseland. And don’t sniff at the new jobs, either, though the wages might not cover rent at River East.
So I say: “Welcome back” to the beast. Over the long haul, its frequent return spells salvation for the entire city. Somebody wake up the planners at City Hall. And get ready for the creature to go away, as quickly and mysteriously as it came.
