On a 13-acre plot of land at 87th Street, just east of the Dan Ryan Expressway, lies the future of economic development in inner-city Chicago.

The local alderman is almost as upbeat. “Are there some drawbacks? Yes. Is it perfect? No. But the positives outweigh the negatives,” says 21st Ward Alderman Jesse Evans. “This shopping mall is economic development, and that means expanding your tax base and putting people to work. That’s what it’s all about.”

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Just north of the mall are the factory and headquarters of Johnson Products Company, the manufacturer of hair products and cosmetics whose founder, George Johnson, once owned the land on which the shopping center is built. Johnson ran his business’s warehouse and distribution center there, but by 1986 he wanted to sell.

The fact that First National would have to demolish the distribution facility added to construction costs for the mall. But Markopoulos figured that the site’s promising location more than offset this drawback. The expressway promised a steady stream of traffic, and across the street was another, smaller complex, anchored by a Jewel food store. With the right mix of retailers, Markopoulos didn’t think he’d have difficulty finding backers.

Aetna Life & Casualty Company agreed to back the project, provided the city kick in with some help. So Markopoulos went to the city’s Department of Economic Development, seeking a financial boost called tax-incremental financing. With TIF, the city borrows money to help finance the project, then repays the loan with the increase in sales- and property-tax revenue brought in by the project. In this case, Markopoulos asked for a $3.1 million TIF.

“A project like this won’t be possible without a TIF,” says Markopoulos. “First of all, we had to knock down the old structure, so that raises our construction costs. We can spend $5 to $15 a square foot just clearing a site.”

“There’s money to be made in the inner city–most of the more sophisticated retailers know that,” says Markopoulos. “Silo [appliance stores] opened a 188,000-square-foot facility in the mall, and they are doing very well. We have a deal with Bonnie Brook Ford that’s very unique. It’s one of the first times you’ve had an auto dealership alongside retailers. They had a dealership at 55th and Ashland, and they were looking for a larger facility. They looked in the suburbs, but we were able to attract them here.