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Big Changes On Tap For Lathrop Overhaul, Including Saving 2 Buildings

By Paul Biasco | July 13, 2016 6:25am
 The historic buildings of the Lathrop Homes redevelopment project that will be renovated.
The historic buildings of the Lathrop Homes redevelopment project that will be renovated.
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Related Midwest

LATHROP HOMES — The massive redevelopment of the Lathrop Homes public housing site is undergoing changes behind the scenes despite having the proposal approved by the city's plan commission.

The changes that are being proposed by the development group come a month after it was revealed that the project was at risk of losing millions of dollars in federal tax credits.

The lead developer on the site, Related Midwest, presented the changes to the plan during a working group meeting with various Lathrop community stakeholders late last month, according to multiple people who were at the meeting.

The biggest change involves the two large "gateway" buildings at Diversey and Clybourn that were originally to be demolished and replaced by new construction, Sajovec said. Those old buildings would remain in the newly discussed plan.

"Their whole pitch on the gateway was we want these quote-unquote nice new buildings to send a message to everybody that this is a totally different site than it was before, but at the same time they are trying to get historic tax credits," said Paul Sajovec, Ald. Scott Waguespack's chief of staff who was at the latest meeting.

A rendering of the buildings that had been proposed to replace the "gateway" buildings at Clybourn and Diversey.

Another change that is being considered is removing two new proposed roadways that would lead into the site on the south end of the development off Damen Avenue, Sajovec said.

Sajovec said the alderman believes the changes are a move in the right direction, but there are still concerns over a 13-story building on the southern portion of the site and 50,000 square feet of retail.

The working group meetings where the plans were discussed are not open to the public.

One of the biggest questions now is whether the new proposal will have to go back to the city's Plan Commission, which had already approved the 32-acre redevelopment in February. 

The proposal the committee approved included the demolition of the gateway buildings and construction of new buildings in their place.

"I think it's pretty hard to argue that this is not a substantive material change," Sajovec said. "In our minds it should go back through the process.”

Alderman Proco Joe Moreno's chief of staff, Raymond Valadez, who was also at the latest meeting, said the developer plans to make up for lost units by constructing two smaller buildings near the major intersection.

"The federal government said that it really preferred to keep the existing corner buildings intact to get the historic credits and [the developer] agreed," Valadez said.

Moreno and Waguespack have disagreed on the redevelopment plans for the site for much of the process.

Unlike Waguespack, Moreno's office does not believe the changes merit a return to the plan commission.

"It's not substantial enough," Valadez said.

A representative from Related Midwest said the company had no comment on the changes or whether the company believed the plan would have to go back to the Plan Commission.

The changes being considered were raised after a letter sent by the National Parks Service to the developer surfaced, which had warned the development team that the earlier proposal might not be eligible for historic preservation tax credits. Those credits would pay for 20 percent of rehab costs and had been presented as a key component of the project's financing.

RELATED: Millions in Lathrop Homes Tax Credits Could Be Lost, Park Service Warns

A spokeswoman for the Chicago Housing Authority, a partner of the project that has committed $75 million toward the first phase of the project, said there have been no setbacks.

"Everything is on track moving forward," said Molly Sullivan, the housing authority's spokeswoman.

The redevelopment of the site has been in the works for roughly 15 years and has appeared to finally gain momentum with the passing of the Plan Commission in February.

On Tuesday, Chicago's Community Development Commission unanimously OK'd the designation of a new Tax Increment Financing district that would help pay for a portion of the redevelopment.

The new Diversey-Chicago River TIF district would be expected to generate $17.5 million for the rehab of the site, with $12.5 million of that going toward affordable housing construction and rehab costs. That includes $4.5 million that would go toward public works on the site including building streets, utilities and parks.

The boundaries of the Diversey-Chicago River TIF District.

A second tax increment financing district is expected to be created to fund the second phase of the project. No details about the second TIF were available.

The overall plan will include 1,116 residential units, a mix of public housing, affordable housing and market rate housing, built over three phases.

The plan also includes extensive landscaping including river walk improvements.

RELATED: Lathrop Homes Master Plan Unveiled (PHOTOS)

Replace Lathrop CHA Units on North Side or No Housing Deal, Moreno Says

Lathrop Homes Plan Moves Forward; Tensions Flare Between Aldermen

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