It’s been the most consistent trend the city has seen over the last three years: Chicagoans leaving Chicago to move elsewhere. Regardless of the reasons: high taxes, gun violence, increasing rent, crooked politics, people are leaving the city, yet the building boom that has curiously grown in reflection of the downward population doesn’t appear to be letting up. If anything, it’s kicked into another gear as more cranes have been raised skyward with the slowly thawing temperatures. When looking at the point of intersection for the rising rents and skyscrapers against the dwindling local population, one has to wonder; when exactly will this bubble burst?
It’s a question that’s been on the mind’s of many a concerned Chicagoan over the last five years or so. As the Rahm Machine has pushed ever harder to give incentives to builders across the city to develop every inch of The Loop and beyond, it has been those who call the city home, the average citizens, who have been hurt most, per usual. As the powers that be continue to believe in the pipe dream that is Amazon’s HQ2 landing here, spurring more glass-lined skyscrapers and pretentious grass-fed burger bars from one neighborhood to the next until the city has quite literally become the North Shore suburbs. It’s a sentiment that was central to Democrat Governor hopeful Chris Kennedy, who charged city officials with systematically pushing out those living below the average income, most often black and brown minorities in favor of a gentrified, indistinguishable cityscape that caters to the yuppie class rather than focusing on the broad shoulders of the working class that put Chicago in the national position it finds itself today.
Courtesy of Chicago Tribune
2017 was the third consecutive year that we have seen population shrinkage in Chicago. To be sure, it is most often not the white in the Gold Coast fleeing the city, but rather those who have been pushed past the breaking point in some of the more forgotten parts of the city. In recent years, many across the south and southwest side have picked up and moved away to municipalities just outside city lines such as Alsip, Maywood, Oak Lawn and Bolingbrook, among others. As we’ve stated in previous pieces, Kennedy’s assertion that city official value the safety and well-being of those in places like River North, Lincoln Park, Wrigleyville and other north side neighborhoods over those in the south and west sides is readily evident. From food deserts to aggressive policing to lack of opportunity and resources, all piled on top of a struggling public school system mired in debt and perpetually closing schools, the situation in certain parts of this city are vastly different from one another. Much like the White Flight of the 60s and 70s which saw predatory real estate agents gut the south and west sides of integrated living, the current trend of movement from those areas to the suburbs represents a distinct shift in how the city will look moving forward, just as it did sixty years ago.
Courtesy of Chicago Tribune
While we can’t say exactly what will happen in the next few years, it appears as though the city is setting itself up for a severe downtrend that already has shown evidence of being on the horizon. Amidst many rumors that several building projects have been propped up by overseas investments, often from Chinese financiers. This is the case with Vista Tower. China’s Dalian Wanda Group is seeking to unload it’s 60% stake in the building, slated to be the third tallest in Chicago. According to a Curbed article from January, “Chinese government regulators cracking down on what they viewed as excessive (and risky) offshore spending by its largest conglomerates—including Wanda. Beijing had also pressured banks to curb lending for big overseas investments.” The 94-story building was originally slated to be completed in 2020, but the fate of the structure is now in limbo.
Vista Tower Rendering
For one reason or another, those at the top of Chicago politics seem completely unconcerned with the looming issue of a local housing bubble. While the suburbs were decimated in certain areas by the 2008 recession, many homeowners or property managers in the city sat on their investments and didn’t lower rent. Because of this and a variety of other issues, they were somewhat insulated from the downward trends experienced elsewhere, and those who were quickly got bought out, torn down and replaced. The reality is that perpetual kickbacks between aldermen who have taken the limits off of building heights west of the expressway that guts iconic neighborhoods of centuries-old charm in exchange for micro-apartments priced above market value that add to the glut of the rentable real estate in the area.
By now, this isn’t rocket science. If I can look at the numbers and the stories and see a pattern, surely those who have been elected are aware of the impending bust. Either they’re willfully ignorant of the problem on the horizon, or simply don’t care as long as their pockets are full. Regardless, it’ll be interesting to see where this trend leads Chicago in the coming years.