Management Firm, Broe Group, To Invest $500 Million In Revitalization Of Chicago’s Illinois Port Authority District
Area Development Online News Desk (07/24/2013)
A private international investment and management company, Broe Group, has been selected to lead a revitalization of Chicago’s Illinois Port Authority District, injecting $500 million in new infrastructure investments and creating up to 1,000 jobs. The project will also create a new partnership with the nearby Olive Harvey College that includes internship sponsorships, job placement opportunities, and training programs for new hires.
“Through smarter and efficient management of Chicago’s port, we will reinvigorate a critical asset for our City in the area of transportation and trade. We are taking what was an underutilized, run down port and turning it into an engine of opportunity through infrastructure investment and job creation that will benefit Chicago and its neighborhoods on the southeast side,” Gov. Rahm Emanuel’s Office said.
The Illinois International Port District owns the Port of Chicago, which has facilities at Lake Calumet as well as on Lake Michigan. It is an entirely self-funded entity and relies primarily on revenues from its tenants in the form of rent and fee payments. The Port District has faced significant challenges in recent years. In addition the port district had not undertaken a significant investment in its physical port facilities since 1981.
Due to significant reforms to the way that the Port operates, the Port operated in the black in 2012 for the first time in a decade. The Port brought in a professional management company to manage the Harborside golf facilities, guaranteeing that the Port will turn a profit on those facilities for the first time in years, the Governor’s Office said.
The Port also hired an independent consultant to study its unique combination of maritime, rail and road access. The study found that the Port has the potential for very significant job growth and expanded economic activity, but that its meager budget and difficult financial position made it difficult to invest to fulfill that potential.
The Port accepted a proposal from the Broe Group to lease, on a long-term basis comprising 62-years, most of the port facilities from the Port District. Under this plan, the Broe Group and other parties expect to invest $500 million in Port facilities over the next 10 years.
“Mayor Emanuel made it very clear that his number one priority for the Port District was to create a competitive business model that creates jobs and maximizes economic growth here,” said Illinois International Port District Chairman Michael Forde. “The Port District board got to work immediately determining the Port's strategic place in the regional and national economy and its potential for future growth. This partnership and commitment with Broe will finally put the Port on the path to becoming the world-class 21st century Port it should be.”