Can the West Side turn around?

Development experts say community development key to economic growth

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By Michael Romain

Editor

Chicago is a tale of two cities. Let the mounds of socioeconomic data and anecdotal evidence speak for themselves. 

According to a government data referenced in a February Chicago Magazine article, the average Loop resident lives to be 85 years old while the average West Garfield Park resident lives to be only 69 — the same life expectancy, the magazine points out, as the average Iraqi. 

"The last time in the United States history when life expectancy was 69 was 1950," Dr. David Ansell, the senior vice president for community health equity at Rush University Medical Center and the author of The Death Gap: How Inequality Kills, told Chicago Magazine. "In seven train stops, you go back seven decades." 

Last year, according to the Chicago Sun-Times, David Doig, a development expert, condensed the growing economic divide between the city's more prosperous and white North Side and the predominantly black and brown West and South Sides into an acute observation. 

"Of 53 construction cranes currently at work in the city, only one is south of 22nd Street," Doig said. 

Doig, who is the president of the nonprofit Chicago Neighborhood Initiatives (CNI) and the former CEO of the Chicago Park District, was one of four economic development experts who gathered at a May 24 Crain's Real Estate Forum to discuss how the predominantly black and brown communities on the South and West Sides can benefit from the investment boom occurring in places like the Loop and West Loop.

The consensus on the panel was clear. Communities on the city's West and South Sides can flourish, but they require more than investors chasing a quick return. If neighborhoods like Austin and West Garfield Park are going to turn around, they'll need investors who are in it for the long haul. 

Exhibit A? The historic South Side Pullman neighborhood, where Doig's CNI has leveraged local assets and the community's rich history to attract roughly $250 million in investment and create around 1,200 jobs in roughly a decade. Doig said "one of the key elements" of the area's revitalization has been its community institutions. 

"In Pullman, we're doing retail, industrial and housing, but we're also working with schools, churches and block clubs," Doig said at the Crain's event. "So there is a social and human capital element to this that has to be addressed. I think where it works best is where you have these pieces working together in coordination. That's the role of community development." 

Since 2014, Pullman has attracted a state-of-the-art Method soap factory, an $8 million greenhouse built atop a factory and owned by New York-based Gotham Greens (a second greenhouse was announced earlier this year) and a Whole Foods distribution center. 

Doig added that a new indoor community center that will host indoor baseball and soccer, among other activities, is scheduled to open in October. 

Doig added that CNI — which, according to its website, does large-scale real estate development, projects, smaller scale neighborhood preservation projects and micro-lending, among other functions — is committed to Pullman for the long-term. 

"I struggle sometimes with for-profit developers who want to spread risk," Doig said. "They don't want to have concentrated risk in any way, but that's not moving the bar. You have to concentrate things, you have to keep doing it. We're not done. We've got more work to do." 

Panelist Michael Altheimer, a principal with Miro Development — a general contractor and property management company that has acquired properties on the West and South Sides — said that there's a lot of investment flooding into "reactivated" neighborhoods like West Garfield Park. There's a flood of capital chasing "yield," he said. 

But places are more than vehicles for absentee investors to realize profits, Altheimer said. Investors must also emphasize cultivating community — even if it means investors moving into the neighborhoods themselves. The buildings are often easy to purchase, he said, but managing them is another story. 

"You have to have corporate sponsors who understand [grassroots community building]," he said. "You still have to knock on doors and understand what's going on in these communities." 

Panelist Laura Granneman, the vice president of strategic investments with Quicken Loans Community Investments Fund — the philanthropic arm of the behemoth Detroit-based mortgage lending company — said that her organization has done just that. 

Quicken's founder, billionaire Dan Gilbert, is the largest landowner in downtown Detroit and the owner of the city's NBA team, the Cleveland Cavaliers. Much like Doig in Pullman, Gilbert has initiated something of a renaissance in the Motor City's center — renovating historic properties, luring cutting-edge companies and high-paying jobs to town and, with them, young professionals and creatives. 

Granneman said that her fund, meanwhile, has been tasked with making sure the swiftly rising fortunes of the city's downtown dwellers don't crowd out residents, most of them black, who reside on the city's impoverished periphery. 

"Detroit has a history of African American homeownership and a lot of that has been undermined — a little by the mortgage foreclosure, but a lot more by the tax foreclosure crisis," she said. "A lot of people owned their homes outright and then, because of a lot of different factors, [among them property assessments that were out of whack in the city], they weren't able to keep up with their property taxes." 

Granneman said that her fund recently deployed people from different community groups to knock on 65,000 doors in order to help homeowners who were at risk of losing their homes due to delinquent taxes. In the last 12 years, she said, there's been around 150,000 tax foreclosures in Detroit.  

"It took us about three months and about $300,000," Granneman said. "It was a different way to use the resources of the community that we hadn't done in the past." 

Granneman added that her fund is also tasked with leveraging Detroit's blight — an average single-family house in the city is valued at around $40,000, she said — into an opportunity to buy into the city's burgeoning transformation early, while the price is still right. 

Is the West Side gentrifying?

For many people who reside on the periphery of today's economic growth — in places still struggling with massive job, population and tax revenue loss resulting from the national manufacturing downturn that ramped up in the 1970s — talk of opportunity and investment momentum too often sounds foreboding. 

On the West Side, as Altheimer indicated, the neighborhood that seems most poised for transformation is West Garfield Park, where home values are increasing and at least two major development projects — The Hatchery, a 67,000-square-foot, $32 million nonprofit food and beverage business incubator, and a proposed $95 million police and fire training academy — are in the works.

More proof that West Garfield Park is heating up came from Airbnb, the short-term lodging company that's more associated with upscale suburbs like Oak Park and tony community areas in the city like the Loop. 

According to data the company released in March, roughly 1,800 West Siders opened their homes and apartments to 152,000 Airbnb guests in 2017 — up 35 percent from 2016. Much of that increase was concentrated in West Garfield Park, company officials said.

But what sounds like progress to some ears sounds like gentrification to others. Both The Hatchery and the police and fire academy have prompted the ire of local activists and community leaders who say that both of those developments seem to have popped up with little input from residents. During one community meeting held earlier this year, the developers of The Hatchery admitted as much and vowed to do better at community outreach. 

Claims of gentrification are also registering beyond West Garfield Park. The Leaders Network, a faith-based social justice group based on the West Side, has recently come out against the purchase of a closed Chicago Public Schools building in Austin by a private, Christian school once located in Oak Park. 

"In a classic case of gentrification, the Chicago Board of Education has transferred ownership of the block-long Austin Key School campus to a startup Oak Park faith based Field School," the organization wrote in a June 12 statement." Key School was closed in the largest disinvestment and closing of public schools in American history." 

The clergymen called the Field School's $125,000 purchase of Key a "classic, colonial racial land grab." 

"Missionaries move in to 'save' the people by taking control of the land," the group stated. "Poor people are made clients, disempowered, and eventually moved off the land in the process of 'saving' their 'souls'." 

During most of the roughly hour-long Crain's forum, however, gentrification wasn't explicitly mentioned until around 40 minutes into the dialogue, after the issue was brought up during audience questions.  

Panelist David Reisman, a commissioner with the Chicago Department of Planning, said that the largest issue on the West and South Sides isn't gentrification, a term that is not often easy to define precisely, but "disinvestment." 

"I think there is a significant concern as to whether investments like the Obama Center and other things contribute to the displacement of existing residents," Reisman said. 

Read more at austinweeklynews.com

CONTACT: michael@austinweeklynews.com   

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