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McCaffery Interests to develop Children's Hospital

By Veronica Appleton and Katie Korman
On September 12, 2011

It's one of the biggest, choicest hunks of available real estate in the Lincoln Park/DePaul area. The question now is whether development plans will win neighborhood acceptance …or trigger "not in my backyard" backlash.

Children's Memorial Hospital announced in July that it has begun exclusive contract negotiations with McCaffery Interests Inc., a Chicago-based development firm, for the sale and redevelopment of its properties at Fullerton and Lincoln Avenues.

The hospital plans to relocate to the Near North Streeterville area next summer.

"I'm going to drive the community to the process because this is the jewel," Alderman Michelle Smith (43rd) said of the site last spring in a campaign speech about the hospital's announced move. "It's steps from public transportation…God knows what you could fit here."

Since then, Smith hasn't telegraphed an opinion of the McCaffery plan, though she has met with community leaders and groups to gauge grassroots reactions. She knows the drill, having campaigned against aspects of the Lincoln Park Hospital redevelopment a few blocks to the south, and having won changes to that plan after taking her seat in the City Council.

Veteran developer Daniel McCaffery knows Lincoln Park/DePaul is a place where informed folks have strong opinions about what fits and what doesn't.

"We are excited by the opportunity to work with Children's, the City of Chicago, Alderman Michele Smith and the Lincoln Park community," declared McCaffery in the CMH press release covering his selection as developer.

The hospital site occupies 3.5 acres, but adjunct properties such as the parking desk across Lincoln from the hospital, pushes the overall size of parcels to be sold to total approximately six acres.

McCaffery proposed to turn the site into a "town center" for Lincoln Park, which would include multi-income housing, open space and retail.

"Our team has extensive experience developing mixed-use projects in neighborhoods such as this," McCaffery said. "We look forward to moving our proposal forward through the public process to create a place that is special and supported by the community."

That "public process" will include working through zoning approvals for the site – a stage historically adopted when neighbors raise questions about density, parking and traffic issues.

The deal also prevents McCaffery from being able to shop the property to other developers.

Lincoln Park Hospital Development

CMH and McCaffery can only hope that this project won't stir the kind of controversy that followed the closing of Lincoln Park Hospital, 550 W. Webster Ave.

"It's an entirely different process and offers much more hope for the community," said David Chernoff, director of planning for the Mid-North Association, a group that filed a lawsuit in the Lincoln Park Hospital dispute.

In June, Ald. Smith repeated her opposition to the redevelopment of the Lincoln Park Hospital site, saying increased traffic to and from a proposed supermarket would cause congestion and detract from the project's primarily residential feel.

However, in early August an apparent settlement was reached after developers agreed to use Lincoln Avenue, not residential Webster Avenue, for unloading large grocery trucks. They also scaled back a proposed office complex and promised to make $60,000 in contributions to a nearby public school and park.

Lincoln Park Hospital closed in 2008 and has been a dead spot along the otherwise thriving Lincoln Avenue strip.

Now Sandz Development is moving ahead with a Fresh Market grocery and non-high-rise residences.

But in keeping with the ways of Lincoln Park, revisions to the plan have not made everyone happy. Attorney Martin Oberman, a former 43rd ward Alderman, represents some nearby residents and insists developers have been "outrageously dishonest in the presentations to the community."

"A divide-communicate strategy"

Now the question is whether that battle will be re-fought a few blocks up the street at CMH. Early signs indicate that may not happen.

"This is an opportunity to create a new neighborhood crossroads," said Ald. Smith to reporters. "I want it to be great."

"McCaffery's proposal incorporates significant community input that we have received throughout this process," said Patrick Magoon, president and CEO of Children's Memorial Hospital.

In August, McCaffery met privately with leaders of neighborhood groups and the community to seek input regarding the development.

"I look at it as a divide-communicate strategy," he told reporters after one meeting. "You get more opinions from more people when you have smaller meetings."

"We're not looking to do a whole lot more," said McCaffery. "I'm not going to try to shove down people's throats that which they don't believe in."

McCaffery said he intends to have larger meetings later this fall, which will be open to the public.

McCaffery's other projects

Neighbors can only hope that, whatever is decided, the CMH project moves ahead faster than some of McCaffrey's other high profile projects.

In 2004, his firm announced redevelopment of the long-dormant South Works steel mill on the city's far south lakefront. McCaffery envisions construction of more than 13,000 homes and 17.5 million square feet of commercial space on portions of the 589 acre USX Corp. site.

The location also has been talked-up as a possible future location for President Barack Obama's presidential library. "It's so damn natural that the Obama library ought to come down here," said McCaffery. "Boy would that turn the trick."

McCaffery beat out other top real estate firms for the Children's project including Magellan Development Group, John Buck Co., and Golub & Co.

What about the students?

Children's is also utilizing the services of the architectural firm Antunovich Associates, which recently designed the new DePaul Art Museum.

McCaffery hopes the mixed-use development will become the center of the Lincoln Park community making students, families and the like comfortable; and so does CMH.

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