Two esports projects in Chicago, once touted as the next big thing, have faded away.
The first project was proposed in 2021 by developer Scott Greenberg, who received the city’s approval to build a $30 million arena for gamers and fans near McCormick Place, to be named Surge.
The proposal included a large area for free-roaming, goggle-wearing contestants and enormous LED screens for tournaments. Greenberg said the facility would provide a unique environment for commercial and community events. The Illinois Institute of Technology offered to partner with the venue to teach game design. “This is something that can change the world,” Greenberg said.
But that’s no longer the case. Recently, Greenberg stated, “The conditions in the gaming industry are changing. Some of the clients I was courting are backing away. A lot out there has been hitting the publishers, and game usage is down a bit.”
The consulting firm Newzoo said 2022 was a “corrective year” for esports, during which the global market dropped about 4 percent to $184.4 billion compared to 2021. Analysts said gaming typically is done at no charge and at home. Esports events usually don’t command a high-ticket price and merchandise sales are disappointing. Greenberg conceded the day may come for congregate gaming “but it’s probably not on the scale I was talking about.”
But he has Plan B. A developer of commercial and residential property, Greenberg owns a former cab company building on South Wabash in which he created, through his company Smash Virtual, what he said is Chicago’s first dedicated LED soundstage, where filmmakers can put actors or props in virtual environments. Smash Virtual recently hosted demonstrations of its technology for 200 filmmakers. Greenberg said if the business succeeds, he’d expand into the original Surge esports arena.
The other esports project that has lost momentum is a nonprofit partnership led by Urban Resolve, which asked the city for incentives to convert the former trading floor of the Chicago Board of Options Exchange on South La Salle into an esports venue with student housing.
City officials said the project wasn’t eligible for subsidies since it’s just outside the tax increment financing district for La Salle improvements. Deputy Planning Commissioner Cindy Roubik said, “It was an interesting proposal coming from a qualified team. Esports and student housing are really good land uses for downtown.”
Urban Resolve Managing Director Erin Lavin Cabonargi said the premise of the plan was that universities would collaborate on a gaming center as a teaching tool. She said revenue from student housing would support the center. However, without a subsidy, the project isn’t feasible in the originally proposed location, but she’d like to find another site. “This would be bringing people together, not as a for-profit venture, but more as a civic attribute,” Cabonargi said.
