The owners of a former lumberyard on Chicago’s Goose Island are offering the land for sale, putting in question Hines’ yearlong plan to build the city's first mass timber building on the site.
CBRE brokers are marketing 1017 W. Division St. for sale without a list price, according to a brochure.
The approximately 2.1-acre property is owned by the Ciral family, which previously ran the Big Bay Lumber business on the property. Family members have been working for years with Hines to redevelop the land.
Efforts to sell the site at the center of the traditionally industrial island on the city’s North Side follow Hines spending about seven years seeking potential office tenants for a six-story mass timber building it sought to build.
It would be part of Hines’ series of T3 projects — short for timber, transit and technology — throughout North America.
That includes similar office buildings from specially engineered lumber in cities including Minneapolis, Atlanta, Toronto and, most recently, Denver and Austin, Texas. Hines also plans a T3 building within its FAT Village mixed-use project in Fort Lauderdale, Florida.
T3 Goose Island’s fate is far less certain. One of the site’s owners, Dan Ciral, declined to comment to CoStar News. In an emailed statement to CoStar News, Chicago-based Hines Managing Director Brian Atkinson did not rule out the possibility of the project still coming to fruition.
“Given the current development cycle, we have faced challenges in securing an anchor tenant,” Atkinson said. “In collaboration with the landowner, we continue to evaluate all opportunities as well as pursue prospects in order to develop T3 Goose Island. We believe in the product typology, sustainability mission, and ultimately the tenant demand as the market recovers.”
The property is becoming available as major changes are expected on and around the 160-acre, man-made island that is surrounded by high-demand residential neighborhoods such as Lincoln Park and Bucktown. The offering also coincides with rising interest rates and construction costs, and low office demand that have made new projects difficult to finance.
Changes Coming
Goose Island hasn’t had residents in decades, but that is about to change.
Canadian developer Onni Group plans to develop more than 5,000 apartments on the southern tip of the island and on another site just across the Chicago River. Other major projects nearby include plans for a Bally’s casino complex on the 30-acre longtime home of the Freedom Center newspaper printing facility.
Goose Island also includes an office and development campus for candy giant Mars and several logistics and manufacturing properties. Just west of the island on Division Street, Logistics Property Co. is building the city’s first vertical warehouse.
CBRE brokers tout the former lumberyard site as viable for projects such as a last-mile distribution warehouse or retail such as a restaurant with a drive-thru.
Houston-based Hines is known in Chicago for projects such as downtown trophy office towers and luxury apartment high-rises along the river, but the firm also has invested in low-rise buildings north of the Loop business district in recent years. That includes the $47 million purchase of a loft office building on Goose Island at 1315 N. North Branch St. in 2022.
National Trend
Construction of mass timber buildings in the United States has increased significantly in recent years as more developers embrace cross-laminated and other mass timber products, which offer the benefits of a smaller carbon footprint and shorter construction time because of large, pre-constructed pieces.
The United States became home to the tallest mass timber building in the world in 2022, when New Land Enterprises and Wiechmann Enterprises completed the 25-story, 284-foot-tall Ascent apartment tower in Milwaukee.
South of there in Chicago, where most of the city’s structures were destroyed by the Great Chicago Fire in 1871, adoption of the mass timber construction has been slower.
Even so, developers besides Hines have been eyeing the concept. That includes a plan by developer Sterling Bay to build a nine-story, 130-unit apartment building made of mass timber at 2100 N. Southport Ave. on the city’s North Side.
For the Record
Owners of 1017 W. Division St. are represented by CBRE brokers Tom Svoboda and Phillip Golding.