Tim Reed, the president of the Greater Northwest Indiana Association of Realtors and a seven-year resident of Valparaiso, recently spoke with a colleague from downstate Illinois about the upcoming Realtor convention in Chicago.
“He wanted to know how long a flight it was from Valparaiso to Chicago,” recalled Reed. “I told him it was a 40-minute drive.”
But for most Chicagoans, such places as Chesterton, Schererville and Crown Point are no longer off the map. Northwest Indiana has reached a critical mass in development and is poised to join the Illinois portions of suburban Chicago in residential and business growth.
Actually, that’s something Indiana officials have been saying for years. Now, however, they have more evidence to prove their point.
Residentially, Northwest Indiana’s Lake and Porter Counties each boast several hot spots where new-home sales have skyrocketed. In Lake County, it’s the towns of Schererville, Dyer, St. John, Crown Point and Hobart. In Porter County, Valparaiso and Chesterton are recording strong new-home sales.
Housing permits for 2000 dipped a bit for both Lake and Porter Counties, but remained strong. Lake County recorded 1,967 permits for new housing in 2000, including 1,547 for single-family homes. That was down from 2,190 in 1999. In Porter, 1,102 permits were issued in 2000 (841 for single-families), down from 1,305 in 1999.
Through April of this year Lake County had recorded 516 permits, 448 of them for single-family homes. Porter had recorded 472, with 240 of them for single-family homes. Townhouses figured prominently in the Porter numbers.
Meanwhile, in towns such as Hammond, Gary, Hobart and Merrillville, sales of existing homes are up. In the first quarter of 2001, the area showed a 3 percent increase from the first quarter of 2000, according to the Greater Northwest Indiana Association of Realtors.
But it’s the scope and, more importantly, the prices, of the new construction that Indiana officials are truly touting.
“During the last five years, the average selling price of one of my homes has been $700,000,” said Jack Wagner, a longtime Valparaiso-based home builder who is developing Harrison West, a 50-unit subdivision in Valparaiso where home prices range from $500,000 to $1.5 million.
“We’ve seen a dramatic increase in move-up and upscale housing in the last few years, but we pushed for that,” said Mark McLaughlin, vice president for economic development for the Northwest Indiana Forum. “We didn’t have a lot of executive housing here previously and that hampered some business owners in their decisions to move their companies here.”
“A $200,000-plus home was unthought of here a few years ago,” said Reed. “Now it’s commonplace. Many homes here hit $300,000, $400,000 and $500,000 and we have homes in excess of a million dollars.”
While many homes and prices are going upscale, officials are quick to point out that a housing dollar still goes a lot further in Northwest Indiana than across the border in Illinois. Lower raw land and labor costs help keeps prices lower than comparable homes in Illinois, they say.
“You can buy a lot more home for the money,” said Nancy Smith, executive vice president of the Greater Northwest Indiana Association of Realtors. “Also, property taxes here are lower than in Illinois. That also brings your monthly payment down.”
“Even $700,000 gets you more here than $700,000 would elsewhere,” Wagner said.
There’s also a lot of affordable housing being built in Northwest Indiana, officials are quick to point out. “I don’t want Valparaiso mischaracterized as rich,” said Chuck Collins, Valparaiso’s building commissioner. “We have plenty of new construction that’s affordable for young families — some homes just over $100,000.”
Most of the move-up buyers are coming from within, officials say. The startup home buyers, meanwhile, are predominantly coming from Illinois, lured across the state line by the lower prices and taxes.
Roger and Janet Vandergenugten, for example, first came to Schererville 12 years ago from south suburban Park Forest. “We knew we could get more house for the money, we knew the taxes were lower and we knew there were good schools here,” said Janet Vandergenugten.
Dealing with new utility companies, new phone companies, new taxing structures and a different state government didn’t impair the Vandergenugten’s move across the state line. “What helped was just about everything was at a lower cost than in Illinois,” said Janet Vandergenugten.
Last year, the couple moved up to a new home a couple miles away in Schererville’s Pine Hill Estates, the site of this year’s Lake County Annual Parade of Homes. “There weren’t many bigger, nicer homes when we first came here,” recalled Janet. “But there are a lot of choices now.”
“I’d say that about 70 percent of our buyers are now move-up buyers from Indiana,” said Jim Hawk, president of the Crown Point-based Hawk Development Corp., which is developing the 150-unit Pine Hill Estates. “The rest of our buyers are from Illinois,” Hawk added. “In the past, [as many as] 60 percent of our buyers were from Illinois.”
Also helping to promote Northwest Indiana’s new stature are several high-profile real estate developments.
In Chesterton, ground is being broken on the massive Coffee Creek Center, a planned community being constructed so that its inhabitants can rely less on automobiles. Developed by the Lake Erie Land Co., the “green” development will have 1,000-plus units of housing; more than 5 million square feet of commercial, office and retail space; and schools and parks. Work is now under way on a handful of homes as well as some of the commercial space planned for the Center.
It follows Lake Erie Land’s gated Sand Creek County Club community, which was also built in Chesterton. There, home prices around a 27-hole golf course go as high as $2 million. Lake Erie Land is a subsidiary of NiSource Inc., a natural-gas firm based in Merriville. Another NiSource subsidiary is NIPSCO (Northern Indiana Public Service Co.).
Another notable development now underway in Portage is Ameriplex @ the Port, a 5 million-square-foot industrial park on 385 acres that will be built over the next 10 years. The facility was opened last year by Oak Brook-based real estate firm CB Richard Ellis Inc. and one of its first tenants was Mercedes Benz.
West along the Lake Michigan shoreline, even Gary is starting to turn around its gritty reputation. Several years ago, the city brought in its hotly debated casino boat operations. Now, aided by millions of dollars in revenue produced by those casinos, Gary officials are planning to move onto bigger and bolder projects.
The city’s Lakefront Redevelopment program is a massive effort, both financially and geographically. The 20-year plan, which will cost as much as $300 million and spread out over some 25 square miles, reformats the Gary lakefront from mostly industrial to residential, commercial and recreational space.
Key components will include thousands of midrise housing units, retail and office space, a harbor and marina and a waterway system.
The city is also building up its Gary-Chicago Airport, touting it as the third airport for the Chicago area. Thanks to an agreement with the City of Chicago, the Gary airport collects more than $11 million each year for capital improvements.
Like home buyers, many of the new Northwest Indiana businesses are also coming across the state line. “There’s the advantage of competitive real estate prices, a lower tax base and lower worker’s compensation and unemployment rates,” McLaughlin said.
Though Lake County’s population rose only 2 percent to 484,564 in 2000 from 475,594 in 1999, that came as Gary lost 14,000 people. In Porter, the population rose 14 percent in the same period, to 146,798 from 128,932.
Adding millions of square feet of commercial and industrial space is especially rewarding to Indiana officials after the industrial skid — most of it tied to the steel industry — the region endured starting in the 1980s.
“Most of the industrial space that went empty has been filled,” McLaughlin said. “But we’ve diversified our industrial base over the last decade.”
“The counties are still tied to steel,” Wagner said. “As the steel industry goes, so does Northwest Indiana.”
Despite the strong growth of recent years, Northwest Indiana officials still admit the region faces a few challenges. The biggest, they said, is still shaking off the cornfield-or-steel-mill stereotype of the area, as well as pointing out that the state line actually borders Chicago.
“The upscale buyer in Chicago still thinks we’re standing around apple barrels smoking corncob pipes,” Wagner joked. “But I’m at White Sox park eating a hot dog in about 45 minutes from here.”
“You can get into Chicago a lot faster from here than you can a lot of northwest and western suburbs,” Smith said.
Those stereotypes are being battled in a number of ways.
“The best way we can sell this area is when people see it for themselves,” said Smith. “Once people get out here, they realize we’re not far from Illinois and we’re not congested.”
Northwest Indiana officials are now also aggressively promoting their region, from running ads in Chicago business journals to issuing a new series of posters based on the popular South Shore Railroad posters of the 1920s. The posters tout everything from the Indiana Dunes to the region’s steel industry.
The officials also plan infrastructure improvements, such as a second South Shore commuter line from downtown Chicago to Valparaiso that would relieve overcrowding on the existing line.
When it comes to growth, what Northwest Indiana officials don’t have to worry about is space. “There’s a huge amount of open space here,” McLaughlin said. “Some towns are still predominantly farmland.”
“We’ve got lots of elbow room around here,” Wagner quipped.
“We’re not even close to bickering over high-density problems,” said Collins. “We’re being careful how we plan things out, but the concern about congestion is still years off.”
