Dive Brief:
- The developer of the new Gensler-designed McDonald’s headquarters in Chicago has secured a $209 million construction loan, according to Bisnow.
- Sterling Bay scored the second-largest development loan for a Chicago-area project since the recession.
- Bankers said that in a tighter lending environment, Sterling Bay was able to win the loan with its excellent credit record, its history of successful projects and a long-term lease with McDonald’s the building.
Dive Insight:
Sterling Bay has already obtained a building permit for the 600,000-square-foot structure, and crews have bulldozed the site, which is the former home of Oprah Winfrey’s Harpo Studios. Developers planned to start work on the foundation and underground garage while the city reviewed the building plans.
The biggest post-recession development loan in Chicago thus far is the $240 million secured by Related Midwest for the skyscraper project known as One Bennett Park. The 70-story, $400 million high-rise will include some of the most expensive condominiums in the city with prices ranging from $1.85 million to $15 million.
Related is also in the planning stages for its development of a 62-acre, riverfront site referred to by some as filling "a hole in the middle of Chicago." Related and partners will turn the former rail yard, now a de facto homeless camp, into a multibillion-dollar, mixed-use complex that will take 15 years to complete. Related and its partners said they will add millions of square feet of office and retail space, in addition to thousands of new homes, to "the last large undeveloped swath of green space" in downtown Chicago.
One of the drivers of downtown development in Chicago and other metros areas is the influx of millennials and their desire for urban-neighborhood living. If the cost of living in those areas becomes too expensive for the younger demographic, then they are likely to move within driving distance or to suburban areas that include neighborhoods that mimic the popular, walkable lifestyle.
