CRE N Illinois

Forecast 2020: The state of the city

Forecast 2020: The state of the city,ph1

Few people really understand Chicago the way that Lori Healey does. A veteran of both the public and private sector, she knows what works and what doesn’t in this market.

On the public side, Healey held various positions for the city of Chicago, including as Mayor Richard M. Daley’s Chief of Staff and as Planning and Development Commissioner. She had senior leadership roles for the NATO Summit in Chicago and the city’s 2016 Olympics bid. Most recently, Healey served as CEO of the Metropolitan Pier and Exposition Authority.

In the private sector, Healey has had roles with Tur Partners LLC, Perkins + Will and the John Buck Company. In September she was named president of Clayco’s new Chicago regional business unit, overseeing the firm’s development-, design- and construction-related activities in the greater Chicago area.

Healey will bring this vast expertise to the 18th Annual Commercial Real Estate Forecast Conference on January 9th. Before she joins the “Big Shoulders. Big Deals. Big Plans.” panel, we sat down with her to assess where Chicago stands and what the new year may hold.

Let’s start with a broad view. Chicago, like most of the rest of the country, is enjoying a record-long period of economic and development progress. Is there anything we can do to extend this cycle?

I believe that the runway in Chicago and the region is still quite long, and that’s driven by a number of different things. That includes multi-year projects that the public sector is doing such as the expansion of O’Hare, the Red Line and Purple Line modernization by the CTA, as well as the impending millions of dollars coming into the state from the federal capital bill that was approved last spring. There are also many mega projects that are just beginning to move forward and a couple of others that might be moving forward. And we will continue to see traditional real estate developments—including corporate relocations and new multifamily—coming online to support the young professionals joining new industries and moving into the city.

More specifically, the Fulton Market District is the hottest neighborhood in the city, if not the country, as you know since Clayco is leading design-build efforts on Fulton East. Why do you feel development here has been so successful? Are there other areas around the city you might point to where this model can also be applied, perhaps during the next cycle?

I think it’s been successful in the Fulton Market District because of the influx of the corporate community, which supports the residential projects, restaurants and new entertainment happening there. Wearing my old hat, I would look to the Southwest and South Loop as future expansion areas that might catch up with what’s happening in the West Loop. On the southwest side there are new projects going on, such as the renovation of the Old Post Office with new corporate tenants headed there. We saw development really begin in the River North area and then swing around to the West Loop; I think that’s going to continue around the downtown area and includes the Southwest Loop and the South Loop.

Can developers and officials follow the Fulton Market model in building up these areas or do they require unique approaches?

I believe you have to work with each area individually. They all have their own character. While there’s been new construction in the West Loop, that has come with a lot of preservation of older, existing buildings, bringing in new uses and new life. The Southwest Loop is a little bit different. There really isn’t any residential and there are bigger sites to work with. And then the South Loop which has a lot of existing building stock, including Motor row, for example, which is a historic district that I love. You have to think creatively about what to do and to make sure that you’re bringing in the kinds of uses that can really enhance these districts and the city.

With your background holding high-level positions in both the public and private sector, I’m curious about your thoughts on public-private partnerships. Are there more opportunities out there that developers aren’t taking full advantage of?

I think there are continuing opportunities, particularly around the development of major infrastructure. Chicago, as you know, has historically used public-private partnerships, such as with the building of Millennium Park. I mean, that was a true public-private partnership where there was an almost even split between the cost of investing in the infrastructure and the private sector contributing money for the amenities. People forget that there used to be a giant hole in the ground with railroads in it where Millennium Park is today, so I think that was a great example. I do think there are opportunities and people continue to talk about it and think about it, particularly for big projects.

To hear more from Healey and approximately 50 other industry experts, sign up now for the Commercial Real Estate Forecast Conference, which will be held at the Hyatt Regency Chicago on January 9th.