Thirty-three years after U.S. Steel closed a massive plant along Chicago’s south lakefront, developers have broken ground on a federal- and state-backed quantum computing campus that they hope will lead to a new generation of computing breakthroughs.
Chicago developers Related Midwest and CRG have begun work on the project within the approximately 440-acre former South Works plant site, the firms and Illinois Gov. JB Pritzker announced Tuesday, when they held a formal groundbreaking ceremony on the site along Lake Michigan.
The announcement follows U.S. Steel’s recent sale of the mostly vacant site where it closed the steel plant in 1992.
“Today we break ground on a landmark project that will establish Illinois as the nation’s leading hub for quantum innovation while attracting billions in economic investment and creating thousands of jobs,” Pritzker said in a statement. “This milestone is made possible by a unique partnership across city, county, state, and private industry, uniting talent and investment to create jobs, drive economic growth, and secure Illinois’ leadership in a technology that will tackle tomorrow’s greatest challenges.
“With trailblazing companies like PsiQuantum and a growing roster of innovators calling IQMP home, we will position Illinois as the global leader in quantum innovation, unlocking new opportunities for scientific breakthroughs and economic advancement right here on the South Side.”
Work on the Illinois Quantum and Microelectronics Park comes as other states and municipalities throughout the country vie to become key players in quantum computing, an idea still in its infancy but believed to have the potential to create breakthroughs in sectors such as pharmaceuticals, energy, finance, climate science and national defense.
Pritzker, Chicago Mayor Brandon Johnson, Cook County Board President Toni Preckwinkle and other political and business leaders marked the formal start of the project in a ceremony Tuesday. The project is backed by $500 million from Illinois, plus local and state tax incentives.
The 128-acre quantum park at the southern end of the site is the initial phase of the larger, 440-acre Quantum Shore Chicago technology and innovation district.
The U.S. Department of Defense’s research and development agency and Illinois officials announced plans for a quantum campus in the Chicago area in July 2024. Later that month, they disclosed it would go on the South Works site with Palo Alto, California-based PsiQuantum as the anchor tenant.
PsiQuantum seeks to build the first big, commercially viable quantum computer on the site.
Other tenants include IBM, the national Defense Advanced Research Projects Agency (DARPA), Australian startup Diraq and Louisville, Colorado-based startup Infleqtion.
Larger plan
IQMP will include an 80,700-square-foot office and research facility as the first of multiple buildings expected to be used by PsiQuantum. The campus also will include a massive cryogenic facility to create ultracool conditions needed for quantum computing, plus other research and office space where universities and private companies can work side-by-side, according to the statement.
As part of the broader Quantum Shore Chicago development of the site, there are plans for a $300 million, 52-bed hospital operated by Advocate Health Care northwest of the quantum complex.
“Quantum Shore Chicago represents this city at its best — ambitious, resilient and focused on the future,” Related Midwest President Curt Bailey said in the statement. “Working in partnership with the South Chicago community, we will revitalize this long-abandoned stretch of land and unlock its potential as a global destination for innovation.”
Funds of Blue Owl Capital financed the land purchase and will back development of facilities there, according to the statement.
Earlier this month, Blue Owl paid more than $69 million combined to acquire several parcels from U.S. Steel, Cook County property records show. Blue Owl then sold those properties to the developers for $58 million, the records show, creating a ground lease in which Related Midwest and CRG will make lease payments to Blue Owl.
The statement did not say how much total financing Blue Owl is expected to provide.
“This investment by our funds reflects our strategy of financing mission-critical assets that enable long-term innovation and infrastructure growth,” Marc Zahr, global head of real assets at Blue Owl, said in the statement. “We’re excited to work with Related Midwest, CRG and PsiQuantum to help lay the foundation for a new era of scientific and economic progress.”
Records also show that U.S. Steel sold a small portion of the land directly to the developers for more than $3 million.
Crain’s Chicago Business previously reported U.S. Steel’s sale of the site and plans to kick off the project.
Related Midwest is part of New York-based Related Cos., while CRG is part of construction firm Clayco.
For the record
CBRE broker Larry Goldwasser represented U.S. Steel in the land sale.