City Council Committee Backs Tax Break for $7 Billion West Side Redevelopment

The Chicago City Council’s Economic Development Committee on Monday advanced a $55 million property tax incentive that would help launch the first phase of the 1901 Project, the $7 billion redevelopment effort planned for the surface parking lots surrounding the United Center on the city’s West Side. The vote moves the proposal a step closer to becoming the first major public subsidy tied to one of Chicago’s most closely watched real estate megaprojects in years.

The incentive, a Cook County Class 7(b) designation, would reduce the property’s assessment level from 25% to 10% for a decade before gradually stepping back up. Total tax relief is capped at $55 million over the life of the incentive. The City Council is expected to take a full vote on the measure in the coming weeks.

Inside the 1901 Project

The 1901 Project is being developed by the Reinsdorf and Wirtz families, who own the Chicago Bulls and Chicago Blackhawks respectively and operate the United Center. The plan transforms acres of parking lots around the arena into a dense mixed-use district anchored by a 6,000-seat music hall, a 233-room hotel, public parks and plazas, retail and restaurant space, parking structures with rooftop greenery, and as many as 9,463 residential units across multiple phases.

The first phase alone calls for approximately 800,000 square feet of new development on 12.3 acres south and west of the arena. According to estimates from the Chicago Department of Planning and Development, that first phase is expected to generate $46.3 million in new property tax revenue, create nearly 2,000 construction jobs, 600 permanent positions, and 180 part-time roles.

Developers must invest $500 million in the first phase as a condition of the tax break, which is structured under a Class 7(b) framework that targets projects “that would not otherwise be economically feasible” in areas in need of economic development.

Local Alderman Burnett Champions the Project

The proposal is being shepherded by Ald. Walter “Red” Burnett (27th Ward), a freshman alderman who succeeded his father last year and grew up near the United Center. Burnett has described the 1901 Project as the largest investment on the Near West Side since the United Center itself was constructed more than 30 years ago.

“When people think about West Loop and Fulton Market, they assume that the United Center, Near West Side, is a part of that,” Burnett said in March when defending the project. He has framed the tax incentive as a catalyst for long-overdue development in a part of the city that has seen limited private investment for decades, while signaling he may not support similar incentives for later phases.

Mayor Johnson’s Position

Mayor Brandon Johnson, who introduced the tax assistance plan in March, has defended it publicly throughout the spring even as Chicago navigates ongoing budget constraints. Johnson has been vocal about opposing state-level tax incentives proposed for the Chicago Bears and a potential Arlington Heights stadium, but has consistently maintained that the United Center project belongs in a different category because of its location, jobs potential, and long-term tax revenue forecasts.

“This is a project that is going to create thousands of jobs and opportunities for the people across the city, but particularly for development on the West Side,” Johnson told reporters in March, adding that the city’s posture is one that signals Chicago “remains open for business, but we’re just not for sale.”

Pushback Over Contractor Diversity

The committee’s approval was not without friction. Some members raised concerns about the lack of diversity among construction firms tapped for the first phase, with several aldermen noting that none of the construction firms selected so far are Latino-owned.

A lawyer representing the United Center’s owners told the committee that the project would include Latino participation as it moves forward, though specific commitments were not finalized during the meeting. The exchange highlighted ongoing tension between major Chicago developments and the city’s longstanding goals around minority business inclusion, particularly on projects receiving public subsidies.

Broader Context for Chicago Development

The 1901 Project is one of several real estate projects tied to professional sports franchises that could reshape Chicago in the coming years. The Class 7(b) tax incentive being applied here is the same designation Bally’s sought last year for a casino project, though that request was ultimately unsuccessful. By contrast, the United Center proposal has had more sustained support from City Hall, in part because of its scale and the projected long-term tax revenue.

Future phases of the 1901 Project could depend on additional public investment, including a potential new Chicago Transit Authority Pink Line station near the United Center. Those discussions remain in flux, though a recently extended West Central tax increment financing (TIF) district could provide funding for transit and infrastructure upgrades.

The full City Council is expected to vote on the Class 7(b) incentive in the coming weeks. If approved, construction on the first phase could begin within months, marking the start of what would be one of the largest private real estate transformations on Chicago’s West Side in a generation.

For the surrounding neighborhood, the project carries the promise of jobs and new amenities, alongside legitimate questions about who will build it, who will benefit, and whether the public subsidies attached to it deliver on their projected returns.