The Chicago Plan Commission on Thursday approved a developer’s proposal to transform a 57-year-old office tower on the Magnificent Mile into a residential building.
Commonwealth Development Partners wants to gut the interior of 500 N. Michigan Ave., a 24-story building designed by the renowned architectural firm Skidmore, Owings & Merrill, and replace its offices with up to 324 apartments, including 64 affordable units .
“There are a lot of people moving to Chicago every day, and we think that’s going to continue,” company co-founder Matthew Faris told the Plan Commission. “Chicago is one of the top five performing residential markets in the country.”
This project still requires the green light from the municipal council. It’s the latest attempt to breathe new life into downtown buildings by replacing outdated or vacant offices with residences. The project would also bring more activity to the Magnificent Mile shopping district, which lost many retailers following the pandemic.
“I think it’s a great redevelopment project because as an office building it’s been stagnant for so long,” said Dougal Jeppe, executive vice president of Colliers, which represents office tenants at 500 N.Michigan Ave. zombie building, without rental speed.
Most of the offices in the 324,000-square-foot building are vacant, he added. Many companies now prefer to rent more modern offices in the West Loop or Fulton Market, where employees also have quicker access to commuter rail.
The overall office vacancy rate on North Michigan Avenue just reached 22.4%, up from 18.3% a year ago, according to a Colliers report.
But apartment dwellers are drawn to the Magnificent Mile, Jeppe said. The street is still beautiful, although some storefronts are vacant, and residents will be within walking distance of the Loop, Lake Michigan, and all of River North’s restaurants and amenities.
“The residences will be a much better use of (500 North Michigan Avenue),” he said.
Plan Commission members said they would like to see other similar projects get underway, particularly in the Loop, where many older properties also struggle to retain their office tenants. Mayor Brandon Johnson was promote an initiativelaunched by his predecessor Lori Lightfoot, to transform a collection of aging office towers on LaSalle Street into residential buildings with about 1,000 apartments in total, including hundreds of affordable units.
“I think it’s a big deal and a great complement to the other projects we’re supporting along LaSalle Street,” said Ciere Boatright, commissioner of the Chicago Department of Planning and Development.
Turning offices into apartments is very expensive, Faris said, and is not feasible for many buildings. But 500 N. Michigan Ave. is slender, with an area of approximately 14,000 square feet and large windows on all sides, so each residence will benefit from natural light, one of the most important factors when renting apartments.
“It’s a rectangular footprint with really good window lines, not all buildings work that way,” Faris said.
The large windows worry environmentalists, who say migratory birds often cannot tell the difference between glass and sky, leading to collisions and deaths. This is especially true for residential buildings, which are more likely than office buildings to be lit at night, when many bird strikes occur. They asked Faris to consider adding a bird-friendly design, such as sintered windows, that birds can see more easily.
“Our city is the most dangerous in the United States for migratory birds,” said activist Andy Burnham. “Help us be the best city in America for birds instead of the worst.”
Ald, member of the Planning Commission. Daniel La Spata, first, supported Faris’ plan, but also expressed concern about potential harm to migratory birds and asked whether the renovation could include a more bird-friendly design.
“We’re willing to consider that,” Faris said. “We need to do more research.”
The Plan Commission also approved Thursday the construction of a two-tower apartment complex in Fulton Market. Developers JDL Development and Fulton St. Cos. plan to create a total of 1,079 units, with 20% reserved as affordable, at 1200 W. Fulton St. and 310 N. Racine Ave.
Although many developers struggle to high borrowing costs and postponed groundbreaking until interest rates fell, Faris said Commonwealth Development Partners already has enough capital to begin the transformation of 500 N. Michigan Ave.
“We would like to start construction early next year,” he said.
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