Sterling Bay’s Lincoln Park Apartment Project Rejected

A dramatic committee meeting derailed Sterling Bay’s plans for a two-building apartment development near the Chicago River.

Sterling Bay’s proposal to build 615 apartments on the former industrial site at 1840 North Marcey Street was blocked by the Chicago City Council’s Zoning Committee, halting a $250 million investment in Lincoln Park and exacerbating challenges for one of the city’s biggest developers, Crain’s reported.

The proposed development, situated near Sterling Bay’s Lincoln Yards site, was slated to include two residential highrises of 25 and 15 stories.

The buildings would have included up to 124 affordable housing units catering to households earning 60 percent of the area median income, if CEO Andy Gloor could’ve secured tax incentives under the Affordable Illinois program.

Revisions to the proposal would’ve reduced building heights, eliminated parking and committed $2 million toward infrastructure improvements, but the committee still rejected it.

Alderman Scott Waguespack, whose 32nd Ward encompasses the site, was a vocal opponent.

“These buildings, according to the opinion of neighborhood groups and neighbors, are too dense and too tall and will add to the dense traffic in the area,” said Waguespack’s chief of staff Paul Sajovec.

The Affordable Illinois program also drew criticism. The program’s tax incentives could lead to a temporary reduction in assessed property value, complicating the city’s broader fiscal challenges, Waguespack said.

Mayor Brandon Johnson’s administration supported the development as part of a strategy to accelerate the approval of residential projects, particularly those featuring affordable units. Even with the mayor’s backing, the committee vote exposed the strength of aldermanic prerogative, where local opposition can outweigh citywide planning goals.

Alderman Anthony Beale led the effort to reject the project after procedural debates over whether to delay or vote outright.

“I don’t feel comfortable supporting a project that my colleague is not in full support of,” Beale said.

The vote has broader implications for Chicago’s real estate landscape. Sterling Bay Managing Director Fred Krol criticized the decision, pointing to the project’s potential to fuel construction jobs, increase tax revenue, and create affordable housing.

“It is extremely disappointing that the alderman has derailed a $250 million investment,” Krol said.

The zoning committee doesn’t have the final word, however. City Council could still override the committee’s decision or defer action until a looming Christmas deadline forces a procedural alternative.

— Andrew Terrell