CHICAGO—Discussions about the Chicago region's economic conditions and prospects frequently touch on Illinois' legendary political battles. Marcus & Millichap's forum on the multifamily industry, held yesterday at the Mid-America Club in the Aon Center, was a perfect example.
Mary Ellen Podmolik, associate managing editor of the Chicago Tribune, interviewed Curt Bailey, president of Related Midwest, for the morning's keynote presentation. And when she asked what could be done to improve conditions in the region, the response was quick and succinct.
“Call your state legislator and tell them to get something done,” he said.
Governor Bruce Rauner and Speaker Mike Madigan locked horns in early 2015 over the former's proposed reforms on taxes, workers' compensation and other items, and the state has gone without a budget ever since. That rather unique status has certainly damaged the state government's reputation, which wasn't exactly unsullied.
When Bailey speaks to lenders from other parts of the nation, “the first thing they want to talk about is the state.” And he hopes that those in the commercial real estate industry will let legislators know about the trouble the budget impasse has caused. “The power of phone calls to these folks is amazing.”
Podmolik asked whether the political struggles had any adverse impact on the rate of development in Chicagoland. Considering the robust pace of apartment construction, Bailey admitted it hadn't.
“But it changes cap rates,” he added. “I know it does.” Lenders tend to be impressed with Chicago, especially the downtown and its surrounding neighborhoods. “Chicago is a completely different place than it was just ten years ago, and continues to be a great place to build.” Still, lenders always ask, “what's going to happen to the state's economy?”
In other respects, however, Bailey felt it was important to keep the focus on Chicago. The state as a whole has lost population, census data show, and even though some observers have pointed to that as a potential problem, he does not agree. “Downtown Chicago is growing like crazy,” and it remains the focus of apartment developers. The decline of other parts of the state “is fairly immaterial.”
Bailey did tell Podmolik that the significant outmigration from the South Side, and the resulting imbalance with North Side neighborhoods, was a concern. He hopes the city can discover some way to rectify the problem, and absorb the southern half's vacancies. If it can, “the future of Chicago is terrific.”
CHICAGO—Discussions about the Chicago region's economic conditions and prospects frequently touch on Illinois' legendary political battles. Marcus & Millichap's forum on the multifamily industry, held yesterday at the Mid-America Club in the Aon Center, was a perfect example.
Mary Ellen Podmolik, associate managing editor of the Chicago Tribune, interviewed Curt Bailey, president of Related Midwest, for the morning's keynote presentation. And when she asked what could be done to improve conditions in the region, the response was quick and succinct.
“Call your state legislator and tell them to get something done,” he said.
Governor Bruce Rauner and Speaker Mike Madigan locked horns in early 2015 over the former's proposed reforms on taxes, workers' compensation and other items, and the state has gone without a budget ever since. That rather unique status has certainly damaged the state government's reputation, which wasn't exactly unsullied.
When Bailey speaks to lenders from other parts of the nation, “the first thing they want to talk about is the state.” And he hopes that those in the commercial real estate industry will let legislators know about the trouble the budget impasse has caused. “The power of phone calls to these folks is amazing.”
Podmolik asked whether the political struggles had any adverse impact on the rate of development in Chicagoland. Considering the robust pace of apartment construction, Bailey admitted it hadn't.
“But it changes cap rates,” he added. “I know it does.” Lenders tend to be impressed with Chicago, especially the downtown and its surrounding neighborhoods. “Chicago is a completely different place than it was just ten years ago, and continues to be a great place to build.” Still, lenders always ask, “what's going to happen to the state's economy?”
In other respects, however, Bailey felt it was important to keep the focus on Chicago. The state as a whole has lost population, census data show, and even though some observers have pointed to that as a potential problem, he does not agree. “Downtown Chicago is growing like crazy,” and it remains the focus of apartment developers. The decline of other parts of the state “is fairly immaterial.”
Bailey did tell Podmolik that the significant outmigration from the South Side, and the resulting imbalance with North Side neighborhoods, was a concern. He hopes the city can discover some way to rectify the problem, and absorb the southern half's vacancies. If it can, “the future of Chicago is terrific.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
