Eighty-Unit Building First Step in Revitalization of Stateway Gardens

Stateway Associates LP chief executive Richard Shields says his development group will likely begin construction shortly thereafter on a 300-unit low-rise development near 35th and State streets. "We're developing both ends of the property at once," Shields tells the city's community development commission, which recommended $734,000 in tax increment financing assistance Tuesday.

The development group includes Shields' Mesa Development, as well as Kimball Hill Homes, Neighborhood Rejuvenation Partners and Walsh Investors. Equity already has been committed, the commission was told, and formal approval of an FHA construction is needed along with secondary financing from the Chicago Housing Authority, city and Illinois Housing Development Authority.

Stateway Associates has bought some of the vacant land for the project, for $112,000, according to property records. However, the city is likely to negotiate the sale of five needed lots for the first building.

All 80 one- and two-bedroom units in Stateway Associates' first building will be rented to those earning 60% of the area median income. However, the developers' architects attempted to design a six-story building that appears to be a market-rate model. "The idea was to bring an affordable rental project with market-rate features," says Jared Davis of Neighborhood Rejuvenation Partners. "We wanted to create something special on State Street, as well as Pershing."

The rest of the project is expected to be developed as a mixed-income development, Shields says. "The context is revitalizing 35th Street to 39th Street, from the Dan Ryan [Expressway] to about Indiana Avenue," he says.

While gentrification has hit the neighborhood to Oakland and Kenwood neighborhoods to the east, land along State Street has lagged, says Robert Ruloff of the department of planning and development's TIF division. "This area has been left substantially undeveloped," Ruloff says.

A hindrance, he suggests, has been the former CHA housing project, which is at the northern end of a row of high-rise buildings that once included the Robert Taylor Homes. The notorious public housing projects are being demolished as part of the CHA's plan for transformation.