One Of Nation's Oldest Public Housing Developments Is Proving Mixed-Income Communities Can Lease Fast

The reconstruction of the Julia C. Lathrop Homes, a Chicago Housing Authority community on the North Side, is about to take another step forward, and officials from developer Related Midwest say the completed first phase shows mixed-income communities can work.

Related officials at first thought piecing together a community made up of market-rate renters, public housing residents and others leasing affordable apartments would take time. But apartments for renters at all income levels filled quickly once the first two-year, $185M phase of reconstruction, mostly on the development’s northern half, was completed in 2019.

“We were most surprised by the market-rate units leasing up quickly,” Related Midwest Vice President Sarah Jane Wick said.

The CHA’s Plan for Transformation, launched more than two decades ago, called for the demolition of what had become high-poverty communities in favor of reconstructed mixed-income developments that blended in more affluent renters.

Achieving that mix has been challenging at other developments such as Cabrini-Green, especially during the Great Recession’s real estate crash, but the 414 units finished at Lathrop, composed of 151 CHA units, 171 at market rate and another 91 affordable apartments, were about 97% occupied throughout the coronavirus pandemic.

“They’re going in knowing it’s a mixed-income community, and that’s not for everybody,” Wick said.

It’s not easy to draw lessons from Lathrop’s successful lease-up, she added. There were about 150 CHA families still in the development when the master plan was completed in 2016. This group had, along with community organizations such as the Logan Square Neighborhood Association, led a years-long fight to preserve a community that originally provided more than 900 public housing units. They were committed to staying and quickly filled the first phase’s CHA units.

Other renters, both market-rate and affordable, were drawn to Lathrop by its historic character and location along the North Branch of the Chicago River. One of the first public housing developments in the United States, it was designed in the 1930s by several leading architects, including noted landscape architect Jens Jensen, whose Great Lawn forms the centerpiece of the development’s northern half.

Officially listed on the National Register of Historic Places in 2012, all of Lathrop’s buildings utilized distinctive brickwork and other architectural flourishes Related had to preserve or re-create, even as it added modern amenities to all units such as washers, dryers and dishwashers.  

“I do think Lathrop is unique because of its location, its historic character, and its open spaces, which is its primary amenity,” Wick said.

Reconstructing Lathrop involves a lot more than doing gut-rehabs and tuckpointing, according to Joy Aruguete, executive director of the nonprofit Bickerdike Redevelopment Corp., one of Related's development partners. When built in the 1930s, Lathrop was in an industrial area, so Jensen and others designed an isolated community, built around its green spaces and cut off from the river, then an open sewer of industrial waste.

“Lathrop was built to turn its back on the community,” Aruguete said.

But the industry is now gone and the river is much cleaner. Canadian geese, ducks and kayakers are frequently seen floating by, and Related rebuilt the riverfront with paths, a boat dock, wetlands with native grasses and plants, and transformed one of the original apartment buildings into a boathouse.

“Usually for real estate companies it’s an afterthought, but this developer thought a lot about the relationship the residents would have with the river,” Lincoln Park Boat Club Executive Director Trish Brubaker said.

The group is a tenant at the Lathrop boathouse and teaches free classes to children who live in the development.

Bickerdike is also holding community events such as movies in the park as well as making sure residents are still engaged with the upcoming development plans.

“We’re not just building buildings here, we’re also designing a community,” Aruguete said.

According to the 2016 master plan, Related Midwest and its partners agreed to preserve and rehabilitate Lathrop’s northern section, demolish and replace most of the southern half with newly constructed units, add some street-level retail and transform an old coal plant at the southern tip into a riverfront amenity. By the end, the original plan called for 1,116 total residences, with 484 market-rate units, 222 for families that meet affordable housing guidelines and 400 for CHA households.

That will take years, but the progress so far does bode well for the redevelopment’s next phase, Wick added. Related Midwest hopes to close on that phase later this month, beginning work on the rehab of another 74 historic units, including those in the last vacant building on Lathrop’s northern half and others in one of the vacant structures south of Diversey Parkway, which bisects the development.

“It’s contingent on what I call an act of God,” Wick said.

By that she means securing an agreement among the many parties involved. At Lathrop, that always includes its nonprofit partners Bickerdike and Heartland Housing, community residents, the CHA, the U.S Department of Housing and Urban Development, the National Park Service, which has a say in the treatment of historic places, along with investors in the Low-Income Housing Tax Credits and historic tax credits that help fund the work. But the deal for these two next buildings is almost done.    

“We are well teed-up to get this started by the end of the month,” Wick said.

Related officials are also eager to begin subsequent phases, which means more negotiations with all stakeholders over how and when to reconstruct or demolish and replace the vacant boarded-up buildings remaining on the southern half, she added.  

The developers want to move fast, she added. Leaving some of the now-unsightly structures up could hurt new leasing efforts as well as current residents’ quality of life. CHA officials say they are committed to working with partners like Related to get things moving, but also hint at possible delays.      

“CHA is actively working to move forward to determine the size, scope and feasibility of subsequent phases, which rely on the availability of tax credits,” according to CHA spokesperson Matthew Aguilar.

“We want to do it all at once,” Wick said.