Chicago’s city council approved about $2 billion of incentives for real-estate developments after Mayor-elect Lori Lightfoot, who had raised concerns about the two projects, backed away from her opposition.

The finance committee earlier April 10 approved the plan to extend about $2 billion of tax-increment financing subsidies to Lincoln Yards and “The 78” developments planned by Sterling Bay and Related Midwest. Mayor Rahm Emanuel had delayed the committee’s planned vote on April 8 at the request of Lightfoot. She gave...