O’HARE — A long-planned affordable housing development that would create nearly 300 apartments near the Cumberland Blue Line station is on hold despite having secured City Council approval and low-income tax credits.
The seven-story, $91 million project by Glenstar Properties at 8503-8723 W. Higgins Road has been delayed because of financial and housing market conditions, said Rima Alsammarae, a spokesperson for the city’s Department of Housing.
A construction start date has not been determined, Alsammarae said. Glenstar declined to comment.
The project includes 297 apartments, 59 of them affordable, near O’Hare Airport. Alderpeople approved it in 2021 over the objections of Ald. Anthony Napolitano (41st). But the land has sat vacant and signs have gotten muddied and ripped.
Standing 90 feet tall with 270 parking spaces, the development is surrounded by mid-rise office and hotel buildings whose owners have said they’re concerned about a lack of nearby homes for their workers, managing principal Michael Klein previously told The Daily Line.
However, investors are pausing financial assistance to developments as the economy struggles, the housing market slows down and there is less demand for market-rate housing, financial experts said. The pause also affects Chicago’s construction workers, who anticipate less work this year on large developments, Crain’s reported.
Last year, the Glenstar development received tax breaks for its affordable units, aimed at saving the developers millions over the next three decades.
Liz Butler, the project’s former zoning attorney, previously said in a statement the relief will enable the company to save $23.5 million in taxes over a 30-year period, while the total cost of providing the on-site affordable units will be about $52 million.
“The tax savings help to partially offset the cost of the affordable component of the project, making it possible to provide these units, but by no means results in a financial windfall,” Butler said.
The incentive was made possible because of an ordinance passed last year that designated the O’Hare area a low-affordability community area.
The ordinance is the first of its kind to give tax incentives to developers building multi-family apartments in areas lacking affordable rental units.
A “low-affordability community” is an area where 40 percent or less of the total housing units are affordable, according to the ordinance.
In the O’Hare area, only 20 percent of housing is affordable to households earning 60 percent of the area median income or less, compared to 36 percent citywide, according to 2019 citywide analysis from the city’s departments of planning and of housing.
Napolitano has said the area is overburdened with residential density. He said he wanted a commercial development at the site instead. He has denied his opposition to the project is because it includes affordable units.
The council moving forward to green light the project broke the long-standing tradition of deferring to the local alderperson’s opinion when it comes to developments in their ward.
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