Where there are overgrown weeds and vacant buildings across Chicago, there's an opportunity for rebuilding our manufacturing sector—the far better option for communities than parking lots or residential displacement
- By Dan Swinney, Manufacturing Renaissance
- December 4, 2020
A by-product of disinvestment and deindustrialization in inner cities has been the expansion of industrial land available as factories have closed. These sites still have the benefit of basic infrastructure, access to talent, and access to companies that could be part of a supply chain for new companies. Under the current paradigm, re-building manufacturing as a path to development has been abandoned. For example, Brach Candy Company on Chicago’s West Side used to be the worksite for 3,700 residents who largely lived in the immediate community, made great wages that could support a family and had key benefits like health insurance. The site—owned by Union Pacific Railroad—is now a parking lot for containers that might employ a handful of people as security guards—an insult to the economic and cultural legacy of Chicago’s West Side. Other large vacant parcels of land became sites for warehouses and distribution centers, commonly referred to as the more appealing, euphemistic label of “E-Commerce.” The companies benefit, the community does not. The community, in fact, becomes more degraded because of these unattractive developments that replace high quality jobs with fewer low-quality jobs.
An additional reason for disinvestment in manufacturing was the opportunity for developers to promote the use of land for commercial real estate and housing and the ability to generate enormous short-term returns through strategies for gentrification—strategies that overly prioritize commercial and retail development projects which typically lead to the displacement of current residents who have lost their jobs, and now face increasing rents. You can see the stage being set for Oak Park to move east into Austin as the default development strategy that has dominated Chicago for the last 30 years and gentrification of Pilsen is under way.
Manufacturing Renaissance (MR) became aware of the impact of real estate developers on our industrial base in the 1980s. The Clybourn Industrial Corridor was decimated by real estate developers offering owners of company’s incredible prices for their land with the purpose of converting what were industrial properties into retail and condo development projects. MR worked on behalf of the United Electrical Workers Union that represented the employees at Stewart Warner—formerly located at the northern end of Clybourn—in a last-ditch effort to prevent its purchase by a British conglomerate—BTR—that was a pioneer in flipping industrial properties into high-end commercial real estate projects. Once they purchased Stewart Warner, they moved production to Mexico and built condos on the property. Sixteen hundred workers lost their jobs. MR began looking for alternatives that could compete as a development strategy with the developers that were cannibalizing our robust manufacturing base, displacing residents, and replacing family-supporting manufacturing wages with minimum wage jobs in the retail and service sectors.
In 2000, MR was introduced to an exciting development in Dortmund, Germany. Dortmund had been a center for the production of steel, mining, and brewing in the Ruhr Valley. In the 1970s and 1980s, Dortmund lost virtually all its manufacturing base. The city government of Dortmund realized that there was no future in trying to reclaim their past strengths in 20th Century manufacturing; they understood the critical importance of reviving and modernizing their industrial base—becoming a center for 21st Century manufacturing. They looked to the future of manufacturing 20-30 years out that anticipated the commercial use of technologies such as nanotechnology and micro-machining and sectors that we would now refer to as “Industry 4.0” that would use these kinds of technologies. They created the Dortmund Technology Park in 2000 and attracted companies, university and research centers, training centers and other stakeholders focused on these sectors. This was entrepreneurial government at its best. By 2010, they created over 8,500 jobs and created 280 companies at the Technology Park embracing the future of advanced manufacturing as the vehicle for economic development rather than abandoning manufacturing.1
In Chicago, MR began to explore a similar path inspired by the Dortmund experience. As our effort to save Brach Candy Company came to an end, our question was what would happen with the 33-acre site with a rail spur? We immediately thought of the Dortmund approach and initiated three different efforts over the last 10 years to develop the site as a job-dense center for advanced manufacturing. Our first effort was to create an industrial park focused on the wind industry. We were informed by an excellent effort initiated by John Colm of Wire-Net2 in Cleveland. A wind turbine has over 8,000 components that can operate for decades without maintenance. These components could be made in an industrial park relying on the skills of Chicago workers experienced in cutting metal. We created the Austin Renewable Energy Innovation Park Project in partnership with several other organizations. After our initial investigations, the market in the wind sector changed denying a “quick success” in our efforts to secure additional partners and capital, so we brought the project to an end, wiser because of the experience.
In 2014, we attracted the support for our concept by Austin Coming Together, JP Morgan Chase Foundation, World Business Chicago, and other organizations. We focused this effort at the medical instrument and device sector anticipating a partnership with the Illinois Medical District and the ability to develop customers out of the many hospitals in the Chicago area. Our primary focus was the revitalization of the Brach Candy Company site. We were successful in signing MOUs with 11 international companies that had interest in the American market for medical devices and further deepened our understanding of what such a development project would require. But again, we did not have the level of investment we needed to sustain the project and called off the effort in 2015—again wiser because of the experience.
In 2017, informed by our previous experiences, we joined forces with West Side Forward and the Safer Foundation and resumed discussions on how we could best develop the Brach Candy Company site in a way that would benefit the community. We created the West Side Advanced Manufacturing Park (WS-AMP) Project. Currently, the WS AMP is reflected in a $225 million proposal. We assembled a team with strong community representation, an award-winning architect—Juan Moreno—the architect for the manufacturing center at Daley College, as well as developers who have the track record of success in projects of a similar scale including Chicago Neighborhood Initiatives and Chicago Impact Company. We secured the support of the new Chicago Community Desk which linked us with the services of Boston Consulting Group who completed an Economic Impact Study based on the location of a Park on a 20-acre site in North Lawndale. The BCG study projected the potential to generate 750 manufacturing jobs leading to an additional 600 jobs due to the job multiplier.
Our proposed park would be governed by a not-for-profit corporation reflecting the community. Its tagline/mission is “…development that is economically, socially, and environmentally sustainable and restorative” rather than a maximum return to shareholders with a few collateral benefits for the stakeholders.
The proposed Park has key features, at this stage, as a prototype for a new paradigm of development:
- Development that is being proposed and controlled by those who represent community interests and the current residents. Governed by a not-for-profit corporation, not a private development company.
- Focus on a sector such as production of medical instruments and devices—a huge and growing industrial sector that presents enormous opportunities for a city like Chicago that is home for over 100 hospitals and medical centers. There is also the Illinois Medical District that has agreed to source locally, creating a huge market for companies producing medical devices and instruments. Similar sector initiatives in medical devices have been successful in cities like Wooster, MA and San Diego, CA.
- Companies that participate in the Park will be highly profitable as they benefit from a ready workforce, close relationships with the Illinois Medical District, and local government support. The community will benefit because of the quality of jobs.; the city will benefit because of a growing tax base and an expanding middle class because of good wages and benefits.
- Potential to disrupt current business models that will further degrade the community and displace current residents such as gentrification or low-employment density projects like warehouses and distribution centers.
- Develop model agreement with the building trades unions and community-based organizations regarding the social contract governing the construction of the site to ensure that Black residents of the West Side Black will have an appropriately significant number of jobs and apprenticeships.
- Seek a level of commitment from Chicago Public Schools and City Colleges of Chicago to increase the education programs linked to manufacturing for West Side youth and residents to ensure that as we recruit companies, the jobs will be filled by qualified residents from the West Side.
- Educational opportunities and training programs for employees within the Park as well as for residents from outside the Park.
Unfortunately, we recently again decided to put this project on hold until we could secure the land and raise the anticipated million dollars needed for the pre-development costs. We are confident that we will finally be able to put all the required pieces together.
In the 1980s, MR began as an organization that focused on preventing the closing of manufacturing companies and the destruction of communities—a consequence of the traditional developers, short-sighted company owners and complicit support by local government actors who no longer recognized the continued relevance of the manufacturing sector in our economy. Over the years, our original instincts and understanding of the critical relevance of manufacturing in our economy and communities has been borne out through the sector’s continued economic output over the decades and numerous reports and studies that show though manufacturing has changed it is still a critical economic engine for many communities nationally. We remain confident that advanced manufacturing sectors can be competitive, strategic vehicles in community and economic development. Over the years we have demonstrated efficacy in assembling a diverse range of partners that are required for this new kind of large-scale developments. Furthermore, from understanding international best practices we know developments by themselves, such as the Park, will not prevent gentrification. Development leaders must be actively involved with enhancing the local education and training infrastructure such that local residents can have the opportunity to access and benefit from new jobs and economic opportunities brought about by these kinds of developments. As such, we have done just that. MR has advocated, advanced and developed education and training programs that are required if local residents are to be hired in new developments such as what we propose through the WS AMP. As advanced manufacturing continues to attract attention and as American companies that moved off-shore are considering returning, we are confident that our vision of development will attract the necessary investment from the financial community as well as local, state, and the federal government to make manufacturing parks a reality.
Through our work Manufacturing Renaissance has demonstrated that we are in fact the kind of developer that Chicago needs. We have the vision, the partners, and the programs that will offer a development alternative to gentrification and warehouses for communities like Austin, North Lawndale, Garfield Park, and Englewood. We look forward to working with others who are committed to this vision of development. We should not accept lower standards for development for communities like the West Side when there are clearly better options that can achieve multiple social and economic goals for communities simultaneously. New development needs to reflect the best use of the land, provide high quality jobs with benefits, and have job density. If we do this right, these kinds of developments will create the conditions for increased retail, commercial and cultural developments that incorporate more environmentally sustainable practices, support local education and training programs, and create the kinds of communities where people thrive.
(1)Dortmund’s Economic Structure and the role of the City of Dortmund Economic Development Agency, 2010, p. 13
(2) Wire Net—now called Manufacturing Works: www.mfgworkscle.or