Just over six years after Sterling Bay won city approval for a $6 billion mixed-use development on longtime industrial land along the Chicago River that would feature towers reaching nearly 600 feet into the sky and 14.5 million square feet of construction, a new joint venture wants to kick off a dramatically different and lower-rising project on the stalled North Side site by next year.
Chicago firm JDL Development and Florida-based partner Kayne Anderson Real Estate on Thursday confirmed that they have entered an agreement to buy 31 acres on the northern half of Lincoln Yards.
They also are offering the first public glimpse at significant ways that one of the biggest development sites in the U.S. is likely to change shape.
Construction of the multibillion-dollar project, to be called Foundry Park in a nod to the land’s industrial past, could begin as soon as late 2026.
Foundry Park is expected to bring 2,000 to 3,000 homes to the site in mostly low- and mid-rise buildings, JDL founder and CEO Jim Letchinger told CoStar News on Thursday.
The pending ownership change for much of Lincoln Yards is the latest twist in an ambitious but winding process to activate vacant land along some of the city’s highest-demand residential neighborhoods with new buildings after gritty previous uses, including a demolished steel plant, left the area following dramatic changes to land-use regulations along the north branch of the river.
Foundry Park is expected to include single-family houses, townhouses, condominiums and rental apartments, Letchinger said. There will be just two or three tall towers, perhaps rising around 400 to 450 feet, on the outer edges of the site, he said.
Letchinger said the project also will create “light office use” and a large amount of restaurant and retail space, with several options for riverside dining and drinking.
The design will be walkable from surrounding neighborhoods such as Lincoln Park and Bucktown, while also providing underground parking for guests visiting from outside the area, Letchinger said. There also will be large open spaces.
“We want to make this a destination,” Letchinger said.
New plans for a large chunk of the approximately 55-acre Lincoln Yards site come after a series of financial challenges in recent years left Sterling Bay and its investors stalled since completing the first building within one of the most-ambitious real estate projects ever undertaken in Chicago. The eight-story life science research property on the southern tip of the site, which is not within the area that JDL and Kayne Anderson are acquiring, remains vacant.
Sterling Bay and partner Lone Star Funds surrendered the northern portion of Lincoln Yards to lender Bank OZK earlier this year.
The contract buyers said they expect to complete the purchase of the 31 acres by the end of the third quarter. In Securities and Exchange Commission filings, the bank previously has said it plans to sell the site for about $84 million.
JDL and Kayne Anderson have explored a deal to buy the southern portion of land still controlled by Sterling Bay and investment partner J.P. Morgan Asset Management, but Letchinger said no deal is imminent for those acres.
“We’re focused on the north, and we’ll see what happens later with the south,” Letchinger said. “We’re not pursuing it at the moment. We are full steam ahead on the north, and the city has been incredibly cooperative working with us on that piece.”
Sterling Bay and J.P. Morgan Asset Management declined to comment to CoStar News. Bank OZK did not respond to a request for comment.
Kayne Anderson and JDL are working with the city’s planning department, 32nd Ward Alderman Scott Waguespack and neighbors to craft a new planned development agreement for the land once occupied by an A. Finkl & Sons steel plant and other industrial companies.
That could include changes to the amount of new infrastructure, such as roads and bridges, that Sterling Bay previously agreed to help fund upfront. Those costs proved to be one of the biggest hurdles for Sterling Bay as challenges such as higher borrowing and construction costs emerged in recent years.
Letchinger said Foundry Park will be family-focused, with outdoor spaces and activities for kids and a wide range of home sizes.
“We’re going to do this the right way, working with the city and the neighbors,” Letchinger said. “We’re excited that we have a path to move forward.”