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<\/p>\nTransit-oriented developments are back in vogue, not only in Chicago\u2019s transit-rich downtown but also in its surrounding suburbs.\u00a0<\/p>\n
Developers are targeting sites near the train and betting on the staying power of TODs, panelists said at Bisnow\u2019s Exploring Chicago\u2019s Northern Suburbs event Thursday. Recent actions from the state\u2019s lawmakers are also boosting their attractiveness.\u00a0<\/p>\n
\u201cIf you look at what we’ve done in the last six, seven years, we’re following the rail,\u201d Harlem Irving Cos. President and Chief Operating Officer\u00a0Rick Filler said at the event, held at Saranello\u2019s.<\/p>\n
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\n Bisnow\/Ryan Wangman\n <\/p>\n
\n Xfinity’s Javier Jugo, the city of Woodstock’s Jessica Erickson, Trammell Crow Co.’s Mary Boehmler, The Drake Group’s Tom Drake, Harlem Irving Cos.’ Rick Filler and URW’s Geoff Mason.\n <\/p>\n
Harlem Irving Cos. has targeted underutilized Metra parking lots for multifamily development in suburbs like Mount Prospect and Crystal Lake, Filler said. Those lots are often owned by the municipality they are in and are able to be developed into higher-density multifamily.<\/p>\n
Filler said the company pursues suburbs with a lot of possibilities for retail and restaurant growth that can support an uptick in residents.\u00a0<\/p>\n
Transit-oriented developers got a major boost from the Illinois government last week when it\u00a0passed a sweeping $1.5B transit bill<\/a>\u00a0that will help the Chicago area\u2019s transit agencies avoid a\u00a0looming budget crisis<\/a>. The bill also includes the People Over Parking Act, which restricts municipalities from mandating car parking for residential and commercial uses in areas near transit.\u00a0<\/p>\n The ban on parking requirements applies to\u00a0any new construction or renovations<\/a>\u00a0that aren\u2019t lodging establishments and that are within half a mile of a public transportation hub or one-eighth of a mile of a public transit corridor.\u00a0<\/p>\n The removal of parking minimums near significant stretches of the city and its surrounding suburbs could lower costs for developers substantially. The cost of creating a parking space can range from $5K to $10K for surface lots and $25K to $50K per space in structured parking garages, according to Birchwood Law<\/a>.<\/p>\n In the suburbs, TODs used to primarily serve commuters who wanted to take the train into the city for work, The Drake Group principal Tom Drake said. After the pandemic and a smaller concentration of in-person work in the city, the TOD dynamic still exists and has staying power.<\/p>\n \u201cTOD is not a fad,\u201d Drake said.<\/p>\n \n Bisnow\/Ryan Wangman\n <\/p>\n \n The village of Wheeling’s Len Becker, Murphy Real Estate Services’ John Murphy, VennPoint’s Scott Levine, Fortune Brands’ Leigh Avsec and NAI Hiffman’s Steve Chrastka.\n <\/p>\n Now, TODs serve a different purpose. Drake said residents want to go downtown for non-work-related reasons, all while avoiding traffic on the roadways. The Drake Group\u2019s emphasis on TODs goes back\u00a0more than two decades, when the developer built in the city itself and had an internal requirement to build its mid-rise buildings close to train stations.\u00a0\u00a0<\/p>\n \u201cIt’s been in demand for a while, and I see it continuing to be in demand until Rick buys up all the remaining sites,\u201d Drake joked.\u00a0<\/p>\n Even office use of transit is poised to increase.<\/p>\n Suburban office absorption improved in the third quarter, with overall year-to-date net absorption climbing to 836K SF, consistent with prepandemic highs, according to a Q3 Colliers report. Class-A properties were the primary driver, contributing 549K SF of positive net absorption.<\/p>\n<\/p>\n