Lining up the ducks behind The Goose

On March 17, BuiltWorlds hosted 'Goose Island 2.0', a well-received presentation and panel discussion on creative urban redevelopment in Chicago and elsewhere. Moderated by Dan Lyne of CBRE, the panel included Matt Garrison of R2 Companies, Caralynn Nowinski of UI Labs, and J. Michael Drew of Structured Development. Below is R2's brief on its island plans.

by ZACK CUPKOVIC, Director of Special Projects, R2 Companies | April 2, 2015

Once upon a time, a local real estate investment firm in Chicago noticed something amiss. For years, the firm had developed a simple strategy: purchase neglected commercial assets in its backyard neighborhoods of River North and the West Loop, and then return them to glory by filling vacancies and modernizing overlooked infrastructure.

But as the firm, and others like it, rehabilitated building after building, it soon became more difficult to find assets that required their expertise. The firm suddenly found itself competing with impatient investors with great balance sheets from far-flung lands like New York and San Francisco.

Always the contrarian, our valiant investors agnostically ventured into the nearby lands of Pilsen, South Loop, and the Ogden Corridor, looking for new opportunities. But none were quite right. Prices were either too high or locations were too remote, until finally they found an area --actually an island-- that was just right.

Duck... Duck... GoosE!

American urban areas today are littered with sub-optimal industrial neighborhoods that come in many shapes and sizes, including meat-packing districts, old transportation corridors, and abandoned manufacturing campuses. Many of them, including Goose Island on Chicago’s near-north side, have important and influential histories, and are centrally located, and thus are primed for redevelopment. But, what is the secret ingredient to success? How do you transform Goose Island, an underutilized, 160-acre industrial tract, from an ugly duckling into a nationally recognized case study for brilliant urbanization?

As real estate investors, we make a living calculating and embracing risk to create value in the form of structures that generate cash flow. As responsible designers and developers, our job is to create buildings that not only attract tenants, but energize and inspire its inhabitants over a long period of time. Our vision for Goose Island is focused on these parallel avenues: wise investment and thoughtful design.

So where do we begin? By pinpointing the pain-points of Goose Island, asking why they exist and how we should fix them.

Infrastructure + Access

Problem: Basic urban infrastructure on the island has fallen behind the rest of Chicago. In many places there are no sidewalks, lights are broken, signage is dated, and streets are in need of repair. This makes the island un-walkable and off-putting. It’s also difficult to access certain surrounding areas despite its core location downtown.

Question: What are the tangible and intangible returns on public investment? How does an island become inviting?

Solution: With new potential for private investment, the city now has reason to invest in the island. A commitment by the city to modernize ancient infrastructure makes the island immediately more attractive. After all, looks do matter. The island becomes more accessible, developers make investments, businesses tap into talent pools surrounding the island, jobs are created and tax revenue is generated. With a little push, the wheels of the machine begin to turn.

Public Space

Problem: Chicago’s proximity to the river is one of its most marketable gifts. Goose Island has better access to the riverfront than any other neighborhood in the city, and yet none of it is activated. Goose Island has zero public space.

Question: How can we rethink public space in a location that’s been industrially focused for more than a century?

Solution: Revitalize the riverfront and recycle it as public space. The river’s eastern branch along the island is unused, so allow sections of it to grow over as a native garden. Create community spaces and walking paths that don’t invade, but coexist with the rare natural topography of the river. Also, utilize historic train spurs as boulevards and paths for pedestrians and bikers navigating the island. Properly activated, public space on Goose Island would have a similar economic and aesthetic effect that the High Line in New York City has had on Manhattan's Lower West Side.

Thoughtful Development

Problem: Urban real estate developers are often boxed into small and expensive land parcels with a capped market rental rate for new construction. As a result, developers are forced to build big, or build inexpensively, in core locations to achieve returns great enough to attract investment.

Question: Can lower risk and irreplaceable geography encourage better design?

Solution: On Goose Island, land is inexpensive and sites are large. This loosens the capital and lessens the physical constraints which hamper most urban developers. And, it’s surrounded by water! This creates opportunities for unique developments that re-imagine the riverfront with striking and original designs.

Goose Island 2.0

At a high level, Goose Island is all about Urbanization, i.e. how to take a sub-optimal neighborhood and use smart design principals to attract the investment needed to create social and economic benefit that is both sustainable and responsible. It’s about using existing parts to build a new and even better machine. If groomed and nurtured correctly, we are confident that this ugly duckling will one day in the not-too-distant future become the golden goose.

The author is director of special projects and an investment analyst for R2 Companies, formerly South Street Capital. He can be reached at zcupkovic@r2.me