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Feb 18, 2019

Posted on
May 27 2015

In late April, five students from the University of Chicago’s Booth School of Business took home $100,000 in cash and other prizes after winning the 2nd annual Kellogg Real Estate Venture Competition. The event was hosted at Kellogg’s downtown Chicago campus and featured entrants from 12 international business schools, including Harvard, Columbia, INSEAD, and the University of Michigan.

Booth’s winning idea was to turn “Block 37,” an abandoned underground subway station in the heart of downtown Chicago’s Loop, into a data center that could offer enhanced speed and security for businesses with heavy data needs in the nearby area. The site is the remnant of a $200 million project, started under the previous mayoral administration of Richard M. Daley, to connect downtown Chicago to its nearby airports by high-speed trains. The project was scrapped in 2008 during the financial crisis when funding to complete the project failed to materialize, and the completed subway shell has stood vacant ever since.

Members of Re-Connect, the Booth team’s official name, stated they had already conducted preliminary discussions with the City of Chicago and that the City had expressed interest in soliciting proposals to find an outside developer to partner with Re-Connect on the project. Re-Connect will be able to use portions of its $100,000 prize winnings, which came in the form of in-kind donations from local legal, accounting, and other service providers, to further develop its idea. The team will also have the opportunity to secure up to $10 million in equity funding from investors who sat on the Venture Competition’s judging panel.

This year’s judges included Sam Zell from Equity Group Investments, Eric Mogentale from Walton Street Capital, and John Kukral from Northwood Investors. The judges expressed concern about the City’s willingness to sole-source part of the project to Re-Connect, but they ultimately decided it wasn’t a big enough risk to detract from awarding the top prize to Booth.

Other finalists included teams from Cornell, the University of California Berkeley, and London Business School – each of whom had emerged victorious from a preliminary round earlier in the day. The subjects of the other finalists’ pitches varied broadly.

Cornell’s team proposed a new hostel brand in Las Vegas aimed at socially-minded international Millennials, modeled after the Freehand Hotel|Hostel in Miami. The group from London Business School represented, an online platform for providing user-friendly data to non-professionalized real estate investors. Finally, Berkeley’s team pitched the construction of a new housing complex on an empty lot in central Berkeley owned by the Berkeley Repertory Theatre. The complex would be used to house interns and visiting actors sponsored by the Theatre, with the remainder of the units being rented out on a flexible basis to the general public using Airbnb.

About the Author

This article was written by Ryan Zampardo '16.