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CHICAGO-US Equities Inc. is not tearing down the wall that is part of Metra's Ogilvie Transportation Center. However, the 112,000-sf retail redevelopment anchored by a 20,000-sf fresh food market is expected to link the West Loop with emerging residential neighborhoods west of the commuter rail station.
The city will contribute $12 million toward the $46.5-million project, being built under at ground level beneath 16 overhead Metra commuter railroad tracks that terminate a block south, at the base of Citicorp Center. Fashioned after venues such as Seattle's Pike Place Market and New York's Grand Central Market, MetraMarket will stretch two blocks, from Washington to Lake streets, incorporating the existing Randolph Street viaduct as well as the retail concourse at the base of the station.
"I think in our 27 years of existence here, this is by far our most challenging project," says US Equities chairman and chief executive officer Robert A. Wislow, whose company is handling development, financing, leasing and management of MetraMarket. "This is just a large brick wall now that goes two stories high."
The brick wall will remain, although restaurants and storefronts are planned along Clinton and Canal streets, with about 100 parking spaces remaining behind the retail space. Likewise, the foreboding Randolph Street viaduct will provide access to more storefronts, including a 20,000-sf fresh market.
The tax increment financing, endorsed Tuesday by the community development commission, is needed to offset higher than usual infrastructure costs. For example, Metra requires the concrete columns supporting the tracks overhead remain exposed. Meanwhile, US Equities will have to create a "pan and drain" water management system to protect the new retail tenants from water leaks, diesel oil separators to mitigate odors from the commuter trains as well as heating and ventilation systems.
US Equities is signing a 90-year ground lease with Metra, which serves 95,000 commuters from the North, Northwest and West suburbs at the Ogilvie Transportation Center. Metra will get 75% of revenues from the redevelopment, Wislow explains, and will eventually be guaranteed a base rent. However, Metra also is signing on as an equity investor, Wislow adds.
Lease rates are expected to range from $20 per sf to $40 per sf, not including tenant-improvement packages. A "large national drug store chain" is being courted as a high-profile tenant, Wislow adds, as well as five other concourse tenants that include coffee shop operators, ice cream parlors and restaurants.
US Equities hopes to begin construction this fall, with completion of the southern block expected by the end of 2006 or early 2007. Potential tenants are being offered a market of 4,896 residential units within one mile of MetraMarket, with another 3,031 units either planned or under construction, according to US Equities. Meanwhile, average income is $115,917, according to the company.
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