Happy Friday. This is The Shake 🤝: the free weekly newsletter that equips you with niche real estate knowledge for those bar talks 🍺 

Here’s what we got this week:

• Chicago’s Rebirth From The Ashes 🔥 

MARKET RADAR

Chicago’s Rebirth From The Ashes 🔥 

Chicago is an iconic city – mostly known today for its unique architecture, delicious (and deep-dish) food 🍕 , and some sort of big bean.

It’s also a legendary case study of a city’s real estate revival through first-class urban planning and zoning standards.

For example, Chicago was home to the world’s first modern skyscraper! Standing 138ft tall, the Home Insurance Building was built in 1885. It was also the first tall building to use structural steel in its frame.

A major factor in using steel as the frame was its extreme resilience to fire… a lesson that was learned the hard way just a few years prior. More on this later.

Anyways, let’s take a step back to before the well-designed skyline we see today.

It was a hot day in October and there had been a drought all summer leading up to The Great Fire of 1871. The initial cause of the fire is still unknown, but the origin was at a shed in the back of a family’s barn on the west side of Chicago.

What occurred over the next 3 days was the most destructive fire in American History.

TL;DR:

• About 4 miles of the city area were destroyed

• Totaling more than 2,000 acres

• 73 miles of roads, 120 miles of sidewalk & 2,000 lampposts

• 17,500+ buildings

• Overall $222 million ($5+ billion today) in property which was about a third of the city's valuation in 1871

• About 90,000 of the 300k city residents lost their homes

The fire's intense spread was aided by the city's use of wood as the predominant building material in a style called balloon frame.

Turns out, EVERYTHING was made of damn wood back then. Two-thirds of all the structures, sidewalks, and even some roads.

It was a huge wake-up call to city officials and the entire US about poor building practices.

The Rebirth

After the fire, Chicago faced the daunting task of rebuilding the city. Property values in Chicago initially dropped due to the destruction and uncertainty.

This created opportunities for real estate developers to acquire land in the areas affected by the fire at lower (aka ‘fire sale’ 🔥 ) prices, and they played a significant role in the city's revitalization.

The reconstruction efforts led to significant demand for labor and materials, providing economic opportunities for the construction industry, including contractors, real estate developers, and builders 🛠️ .

The opportunity to rebuild Chicago from the ground up also allowed for important urban planning decisions.

Implementation of modern building codes, fire prevention measures, and the introduction of fire-resistant materials like steel and brick carved the path for future development standards throughout the US.

As the city was rebuilt and experienced a period of rapid growth, real estate values rebounded, and the city's real estate market began to thrive.

Prominent architects like Louis Sullivan and Daniel Burnham helped create innovative architectural designs that contributed to the city's reputation as a hub for modern architecture.

Despite the immense tragedy of the fire, Chicago demonstrated remarkable resilience. By 1900, Chicago became the 5th largest city in the world.

The city's determination to recover and rebuild, coupled with its strategic location as a transportation and commerce hub, led to its continued growth and prominence in the real estate world.

Looking back, the Great Chicago Fire of 1871 was a pivotal moment in the city's history and led to a transformation of the US development code.

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^{DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.}