A Silicon Valley company chose a long-vacant former U.S. Steel plant site on Chicago’s south lakefront as the place where it hopes to create the world’s largest quantum computer within a campus backed by the U.S. Department of Defense and state of Illinois.
PsiQuantum, based in Palo Alto, California, is set to become the first tenant on the campus. The company as well as Chicago and Illinois officials plan to eventually expand into the entire 430-plus acres on the City’s South Side along Lake Michigan between 79th Street and the Calumet River. It is the anchor tenant for what is being called the Illinois Quantum and Microelectronics Park.
The technology company’s deal and the location of the campus were announced Thursday, a little more than a week after the Department of Defense’s involvement in the Chicago project was disclosed.
It was a major step in Illinois Gov. J.B. Pritzker’s long-running goal to have the state take on a central role in the emerging form of high-tech computing, which is expected to lead to breakthroughs in several business sectors.
The so-called Quantum Proving Ground partnership was formed to bring closer to reality Pritzker’s vision for a huge, cutting-edge research campus in which subatomic particles will be used to store and process information, leading to technological capabilities not yet imagined.
Thursday’s announcement comes just weeks before the Democratic National Convention is set to arrive in Chicago, with Pritzker’s name mentioned by political pundits as one of several potential candidates to run as vice president on a ticket with Kamala Harris.
“This is the Manhattan Project of the 21st century,” Kyle Schulz, chief growth officer at economic development agency World Business Chicago, told CoStar News. “You will see every company in banking, pharmaceutical, climate science and manufacturing involved in innovations that will come out of this campus, developing the next phase of our economy. We’re still in the dawn of what quantum will mean in our lives, but Chicago will have this as a major part of our community and our economy.”
Big Potential
If quantum computing reaches its imagined potential, it could have a major impact on the economies and real estate markets among the biggest quantum computing clusters. Markets including San Francisco, Boston, Seattle, Denver and upstate New York also are vying to become the top quantum cluster.
The Department of Defense is involved in the Chicago project because it sees quantum advances boosting national defense capabilities, and because of security threats posed by other countries developing superior quantum capabilities.
Last week, Pritzker and federal officials outlined plans for the Defense Advanced Research Projects Agency, or DARPA, to bring researchers to a campus backed by $140 million in initial investments from the Department of Defense agency.
The state is investing $500 million toward the construction of the campus.
PsiQuantum will be receiving state incentives valued at around $200 million, according to a statement Thursday, if the company creates at least 154 jobs and invests almost $1.1 billion. But PsiQuantum is expected to exceed that, Schulz said, with an estimated 250 jobs created in the years to come as part of a $5 billion capital investment in the Chicago facility.
Last week, federal and state officials did not say whether the campus would wind up on the Chicago site or on a former Texaco refinery site in suburban Lockport, Illinois. PsiQuantum’s interest in those sites previously was reported by Crain’s Chicago Business.
The Chicago area already is home to large teams of quantum researchers in the Argonne and Fermi national laboratories.
“Chicago is a world-class city with everything PsiQuantum was looking for when identifying a location to build our first utility-scale quantum computer in the United States, from top talent and research institutions to global connectivity and a strong infrastructure, and more,” PsiQuantum CEO and co-founder Jeremy O’Brien said in a statement. “PsiQuantum is proud to serve as the anchor for the Illinois Quantum and Microelectronics Park, and we look forward to being a part of this great city for decades to come.”
Development Partners
Chicago’s quantum campus will be developed by a joint venture of Related Midwest and construction firm Clayco’s CRG development arm. Another Clayco affiliate, Lamar Johnson Collaborative, is the architect.
The developers are buying the entire 433-acre site from U.S. Steel, with plans to initially develop the 128-acre block of land on the southeast portion of the site, Schulz said. Schulz led the economic development agency’s yearslong effort to land PsiQuantum, which Schulz said conducted a national search for a site to create the first full-scale quantum computer in the world.
A 300,000-square-foot building will house a massive quantum computer as well as office and research space. The facility can be expanded in later construction phases, Schulz said.
The campus will include DARPA space and a shared cryogenics facility to create ultracool conditions needed for quantum computing, Schulz said.
Water from the lake can be used to help cool the site, and the site can accommodate the required 350 megawatts of power needed, according to a statement from Illinois officials.
PsiQuantum plans to work with Fortune 500 companies and other customers to create new technologies.
Development meetings will begin soon, with plans to move quickly on construction, Schulz said.
“We are in a quantum race with other countries that are trying to own the sector,” Schulz said. “We hope that within 18 months we will be opening the initial buildings on our campus.”
Talks are ongoing with other potential tenants, he said.
Industrial Past
U.S. Steel closed the plant in 1992 and later demolished buildings on the site near the Chicago Skyway, a 7.8-mile elevated highway that connects the Indiana Toll Road to the Dan Ryan Expressway.
The site has clearance for development by environmental regulators, but city officials will work with the Illinois Environmental Protection Agency to address “unforeseen remediation requirements,” according to a statement from Mayor Brandon Johnson’s office.
"PsiQuantum's investment in the City of Chicago is a groundbreaking leap into the future, making our city the future home of America's first utility-scale quantum computer," Johnson said in the statement. "This monumental project will revolutionize entire industries from medicine to clean energy technology, creating countless jobs and driving economic growth in the process. Together, we are solidifying Chicago's place as a global hub for technological advancement."
U.S. Steel has marketed the property, also known as the South Works site, for sale off and on in recent years.
Several proposals for the site had emerged, including a local firm’s plans to build more than 13,000 homes and more than 17 million square feet of commercial space; two European firms’ vision for 20,000 modular homes; and an attempt to create a movie production campus. The site also was considered for Chicago’s first casino, but Bally’s proposal for a River West parcel was chosen.
“There have been several attempts to redevelop the site, but the sheer size has always been the biggest obstacle,” Schulz said. “In this case, it was considered a massive plus. We’re in the dawn of quantum leaving the world of academia and becoming part of our everyday world.
“Without being able to look into a crystal ball, PsiQuantum will have all the additional acreage to be able to grow with confidence that they won’t have to find additional land in the future. That became one of the biggest selling points that we could offer.”