A groundbreaking ceremony was held Thursday for the 190,000-square-foot facility.
The deal for the store came together when the chicago housing authority agreed to a land swap with target.
The store will bring 200 permanent jobs to the neighborhood.
Target has agreed to reserve some of them for local residents.
"We're going to have 75 permanent jobs for CHA residents and that means when jobs become available CHA families have first option to get those jobs," said Chicago Housing Authority's Charles Woodyard.
The store will open in a year and is expected to bring other businesses to the area.