Commission awards contracts to begin demolition of Michael Reese Hospital to build Olympic Village
The Mayor Daley-chaired Public Building Commission today took a giant step toward building the $1.1 billion Olympic Village on the Michael Reese Hospital site--alternately viewed as the riskiest element of Chicago's bid and its most significant legacy.
The PBC awarded $11 million worth of contracts to a pair of companies responsible for building abatement and demolition.
Brandenburg Industrial Service Co. ($7.98 million) and Heneghan Wrecking Co. ($3.19 million) will get control of the 37-acre hospital campus on Friday and begin the painstaking survey work. The companies must file a detailed work plan by July 30.
Building abatement and interior demolition is expected to begin next month. Only then can structures be torn down, probably sometime this fall.
The plan calls for 28 of 29 buildings on the Reese campus to be demolished--everything but the hospital's historic main building.
Local residents concerned about contamination and construction debris have been assured that U.S. Environmental Protection Agency standards will be followed.
"The site is going to be fenced. There will be security there. Every precaution is being taken to secure the site and keep it contained during this process," said Molly Sullivan, a spokesperson for the city's Department of Community Development.
"Extensive abatement is needed. We knew that going into this. But professionals have been hired to do this work. They will be complying with environmental standards. We expect things will go smoothly."
Ald. Toni Preckwinkle (4th) said she had a two-hour meeting with Prairie Shores residents on Tuesday night to address their concerns and allow them to question Chicago 2016 officials.
"I'm fairly confident they're going to be extraordinarily careful about this," she said. "We're going to take the buildings down. There might be some dust issues. But they're doing monitoring of air quality all around the site. Believe me, every effort is going to be made so there is no negative publicity."
Brandenburg has promised to share 44.6 percent of the work with minorities and women. Heneghan will set aside 46.9 percent. The Reese demolition is expected to create 150 jobs, 22 of them filled by community residents. Fifty percent of the work will be performed by Chicagoans.
The city's $86 million purchase of the Reese site was salvaged, only after the property owner agreed to restructure the agreement to accommodate soaring demolition and environmental clean-up costs.
The mayor's original plan called for Medline Industries to make a "charitable contribution" of $20 million that was supposed to be enough to cover demolition, environmental cleanup and five years of interest payments on the loan.
Instead, demolition and cleanup costs were projected at $32 million and rising. Medline agreed to raise its "charitable contribution" to $32.5 million.
The Union Labor Life Insurance Co. and the AFL-CIO investments trusts have signed a "letter of commitment" to pump $500 million into building the Olympic Village.
Olympic Village projects in London and Vancouver have run into trouble because of the worldwide credit crunch, forcing both cities to ride to the rescue.
The union's investment could help shield Chicago from a similar disaster. It also increases the chances that City Hall will succeed in unloading the Reese property to a master developer during the five-year window when neither principal nor interest payments are due on the 15-year, $86 million loan.
Daley plans to forge ahead with the new lakefront community--with a mix of affordable, market-rate, student and senior housing--with or without the 2016 Summer Games. The union's investment would be contingent on Chicago winning the Olympic sweepstakes.