economic benefits

Northwestern University is proposing to demolish the former Prentice Women’s Hospital to build new medical research space at that site.  A number of recently unveiled counter-proposals envision the construction of the desired research space at an adjacent location and the rehabilitation of Prentice into an auxiliary facility that will support medical research and other university functions.

Each counter-proposal accommodates Northwestern’s stated space and facilities needs and incorporates space use recommendations for Prentice from a study by Loebl Schlossman & Hackl Healthcare Consultants. This approach to reuse was the subject of an economic analysis conducted by the Econsult Corporation. The analysis used the economic benefits touted by Northwestern as a baseline:

  • Northwestern has stated its proposal would create 2,500 construction jobs, add 2,000 new full-time jobs and contribute $390 million annually in net economic impact for Chicago. The counter-proposals have upfront construction and ongoing operations in common with Northwestern’s proposal, and therefore the economic impacts that would result.

The counter-proposals would deliver the following economic benefits in addition to those promised by Northwestern through new construction for medical research and the reuse of Prentice:

  • Upfront rehabilitation of Prentice, and the spillover economic activity that results from it, would generate $103 million in one-time expenditures, support 580 temporary jobs and generate $369,000 in tax revenues to local and county governments.
  • Ongoing operations at Prentice, and the spillover economic activity that results from them, would generate $155 million in annual expenditures, support 980 permanent jobs and generate $1.1 million in tax revenues to local and county governments.
  • The combination of preserving Prentice and adding new research space at an adjacent location would likely generate more positive property value impact nearby than simply demolishing Prentice and building new research space there, with attendant increases in property tax revenues to the City of Chicago and Chicago Public Schools on the order of hundreds of thousands of dollars per year.

Econsult Corporation’s complete economic impact report is available online at: Econsult Corporation – Economic Impact Memo.

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