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Data Snapshot: Bringing Retail to Chicago’s South Side
Pullman was America’s first company town, where in the 1880s the workers at the Pullman rail car factory and their families lived, worked and played. At its height, the company employed 6,300 workers, including Michelle Obama’s great-grandfather. Later, the predominantly African American neighborhood was home to Ryerson Steel, one of several steel plants on the city’s south side.
Pullman Whole Foods Distribution Center
While much of Chicago has prospered into a global financial center with a highly diversified economy anchored by financial institutions, engineering, and science, its South Side – so-called “Old Chicago” – has fallen far behind. Like many Midwestern cities, Chicago’s working-class neighborhoods suffered a significant decline as the deindustrialization trend accelerated in the 1980s.
Such as the case in the historic Pullman neighborhood on the Southside, shuttered rail and steel manufacturing plants sat vacant for decades, a reminder of a lost era of middle class prosperity. The town of Pullman was founded in 1879 by wealthy railcar manufacturer George Pullman as the nation’s first planned industrial community. It was the epicenter of America’s most famous labor strike, one of the birthplaces of the American labor movement, and a community with an important role in the early Civil Rights Movement.
Pullman’s economy began its decline in the 1950s and the neighborhood narrowly escaped total demolition in the 1960s. For the past century, the Pullman neighborhood has been able to retain both its architectural heritage and working-class character despite tough times.
In 2010, Chicago Neighborhood Initiatives (CNI) was created to coordinate resources, economic development and neighborhood revitalization in Pullman. CNI and their partners faced a stiff headwind. At the height of the Great Recession, Pullman’s poverty rate rose to 39% and its unemployment rate nearly reached 40 percent.
While Pullman had suffered greatly from the loss of the steel and rail manufacturing industries that fueled its initial growth, CNI focused attention on the community’s assets: historic buildings; the availability of developable land; rail, air, road and water connections to both the Atlantic and the Pacific; and, of equal importance, an organized community that valued the past as a foundation for building toward the future. The New Markets Tax Credit has been a key part of CNI’s strategy, providing financing for large-scale industrial redevelopment projects across the neighborhood.
One such project, the new Whole Foods Midwest Distribution Center, will bring 100 jobs back to the Pullman area in 2018. The $28.5 million project was made possible thanks to $24 million in NMTC financing from CNI, the National Community Investment Fund, and U.S. Bancorp Community Development Entity and an NMTC equity investment from Citi and U.S. Bank.
The new 140,000 square foot distribution center will take advantage of the Pullman neighborhood’s skilled workforce, close proximity to the interstate, and diverse business climate to serve Whole Foods Market locations across the Midwest, including 25 currently in the Chicago area and new stores in the Chicago neighborhoods of Hyde Park and Englewood and the suburb of Evergreen Park..
“Let me just say what Whole Foods means to the 9th Ward—it means opportunity, it means hope. When you bring jobs back into the community what you’re really doing is giving them hope. We know the 9th Ward has had challenges over the years,” said 9th Ward Alderman Anthony Beale at the opening ceremony of the project.
The site of the new Whole Foods, which required extensive environmental remediation, was originally where the production and assembly of the Pullman Railway Cars occurred in the late 1800s.
The Whole Foods project is just one of many financed by CNI and its partners to address challenges in Pullman and the surrounding neighborhoods. Other projects include a new Method Soap plant, a grocery store, affordable housing, and the Pullman Community Center, which will provide the neighborhood with three 121 x 200 foot full-sized indoor multi-sport fields that will accommodate baseball, soccer and lacrosse — making it the only facility on south east side of Chicago to offer year-round play.
CNI also served as the master developer of Pullman Park, a 180-acre mixed use site at 111th Street and I-94, where CNI has coordinated $250 million of new investment and created nearly 750 new jobs. Pullman Park is providing new retail goods and services to Pullman, Roseland and the Greater Calumet Region, including a 150,000 square foot Walmart, featuring a full-service grocery; more than 70,000 square foot of new retail space anchored by a Ross Dress for Less, a Planet Fitness, and an Advocate Health Care.
CNI’s work in Pullman has proceeded at such a pace that the organization expanded beyond the neighborhood to nearby Bronzeville and Englewood.
About Chicago Neighborhood Initiatives
CNI was formed as a stand-alone tax-exempt Illinois nonprofit in 2010, following the acquisition of its predecessor financial institution by U.S. Bank. At the time, CNI’s balance sheet was approximately $10 million and it was mainly focused on the strategic revitalization of a 180-acre brownfield site in Pullman on Chicago’s far south side and restoration of historic rowhomes in the surrounding neighborhood.
Through the years, CNI’s reach has extended to other neighborhoods that remain underserved by for-profit developers and banks, primarily on Chicago’s South Side, including Englewood (site developer for Whole Foods) and Bronzeville (co-developer of Mariano’s grocery store and joint venture partner in GRIT Chicago – recently awarded with the phased redevelopment of the former Michael Reese hospital site). CNI has also been charged with the role of lead developer of the Pullman National Monument Visitor and Welcome Center. In 2012, CNI broadened its economic development offerings to include a CDFI certified by US Treasury to make microloans to unbankable entrepreneurs (to date CNI has deployed approximately $2 million loans – CNI’s borrowers are 85% African American-owned businesses) and has deployed $80 million in federal and state New Markets Tax Credits into community facility and industrial real estate projects.