CHICAGO-The City Council has approved a redevelopment agreementfor the first phase of a $4 billion redevelopment project of aformer steel plant site, being planned by a partnership ofMcCaffery Interests and US Steel Corp. The city will contribute $96million in a TIF for the project on the South Side, an area notknown for commercial success.

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The entire25-year plan, a redevelopment of the US Steel plant with slagand trucked-in dirt on the property, includes more than 13,575 newhomes and a 17.5 million square feet of retail and other commercialalong the shores of Lake Michigan. The property will also have a90-acre park and a marina.

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The first phase will include more than 800,000 square feet ofretail and about 1,000 apartments, in a development called MarketCommon. For this phase, the city has pledged the TIF funds inconstruction of new streets, sewers and other public infrastructureas part the 76-acre land parcel bounded by 79th Street,83rd Street, Brandon Avenue and US Route 41. However,the city has reportedly put requirements on the funding, includinga provision that the partnership get lease commitments for 60% ofthe first phase retail.

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Work on the project won’t reportedly begin until 2013, afterSouth Shore Drive can be moved to flow around the site. Some localexperts have said there are high hopes for the development, butskepticism about demand and financing during a downturn. The cityis now experiencing a flattening of activity in all propertymarkets. Dan McCaffery, president of the self-named firm, did notreturn calls about the project.

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