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terling Bay's Lincoln Yards project has suffered a significant setback as the Chicago-based developer has agreed to transfer a substantial portion of its planned 53-acre development site to lender Bank OZK. The move involves surrendering control of the northern segment of the property through a deed in lieu of foreclosure, marking a major blow to Sterling Bay's $6 billion vision for a mixed-use complex along the Chicago River.
The deal allows Sterling Bay to settle a $126 million mortgage loan with Bank OZK, which had extended the maturity of the loan multiple times and expressed concerns about the project's viability through recent writedowns. The lender now plans to market the property to new sponsors after efforts by Sterling Bay to secure additional financing faltered.
The relinquished land includes a 28-acre parcel that was once home to the A. Finkl & Sons steel plant, adding uncertainty to the project's future size and use. Despite this setback, Sterling Bay CEO Andy Gloor remains optimistic about the company's ongoing involvement in Lincoln Yards, citing "unprecedented pressures" on real estate financing markets as a major challenge.
The project has faced numerous delays since its approval by Chicago's City Council in 2019, including disputes over infrastructure funding and regulatory hurdles. While Sterling Bay had sought to consolidate ownership under a single entity, the company is now working with Bank OZK to navigate the next steps for Lincoln Yards.
