Millennium Park Brought Residential Real Estate Boom And Numerous Other Benefits To Downtown Chicago, New Study By DePaul And Texas A&M Universities Finds

Oct 13, 2011

Millennium Park Brought Residential Real Estate Boom And Numerous Other Benefits To Downtown Chicago, New Study By DePaul And Texas A&M Universities Finds

Downtown Chicago’s Millennium Park has benefitted the city in numerous ways, including spurring a real estate boom that added thousands of residential units to the East Loop and generating billions of dollars in additional tourism revenues, according to a new comprehensive study of the celebrated park’s overall impact.

The study, co-authored by researchers at DePaul and Texas A&M universities, has found that since the park’s 2004 opening a number of other indicators – ranging from a drop in area crime to significantly increased usage of nearby rapid transit stations – suggest the park has benefitted Chicago even more dramatically than previously perceived.

Among the study’s more significant findings:

Approximately $2.45 billion in construction spending has taken place in the vicinity of the park since 2004; Residential housing units in areas adjacent to the park increased 57 percent and now total more than 9,900 unit while the residential population in the area increased 66 percent to more than 10,000;
12.8 percent of all visitors to Chicago visit the park. Tourism attributable to the park has added $11.1 billion in direct and indirect spending each year. The number of hotel rooms in the area increased 18 percent. Cultural programs at the park’s Harris Theater produce $3 million in ticket sales annually; and
Usage of the elevated train stations nearest to the park has increased 35 percent between 2004 and 2010, while violent crime in the area fell 27 percent.

“Millennium Park is widely recognized around the world as a major urban redevelopment success story,” said Susanne E. Cannon, the Douglas and Cynthia Crocker Endowed director of the Real Estate Center at DePaul. “This study shows that the impacts are even more dramatic and far-reaching than was previously understood.”

The analysis was based on reviews of public records and interviews with major stakeholders in the project, including former Sara Lee CEO John Bryan, who spearheaded the private fundraising campaign for the park. Others interviewed include Richard Hanson, Sr., president, Mesa Development, LLC, who developed two nearby luxury condominium buildings on Wabash Avenue overlooking the park. Hanson notes in the study that despite the overall fall in housing values, units at those buildings continue to appreciate and that units with park views command a 29 percent premium over others.

The study utilized the “quadruple net valuation” methodology developed in recent years at Texas A&M by Dennis Jerke, adjunct professor in the school’s Landscape Architecture and Urban Planning Department. The methodology examines real estate projects on the basis of economic, social/cultural, environmental and sensory impacts.

The full 78-page page report can be found at http://bit.ly/nI2QGg. A video featuring interviews with study participants is available online at http://vimeo.com/29045390.