Chicago to Turn High-Rise Offices into Housing

Adaptive reuse of office buildings into housing is a popular topic across the country, particularly as more employees are working from home either part or full time since the pandemic. Downtowns in major cities like Chicago have been particularly hard-hit. Vacancy rates in downtown Chicago hit an all-time high of 21.2 percent at the end of 2023. But the Windy City is hoping to turn lemons into lemonade by converting four underused high-rise office buildings in its La Salle Street financial corridor in the Loop into 1,000 new apartments, reports Chicago Construction News.

Four projects have been selected so far, which according to Mayor Johnson’s office, are collectively valued at more than $528 million in development costs. The project’s developers will receive tax increment financing (TIF) assistance totaling more than $150 million to ensure 319 of the units will be rented at affordable rates (which the city defines as tenants earning an average of 60 percent of the area median income, or approximately $53,000 for a two-person household).

Additional projects are likely to come. Chicago Construction News reports that the city has allocated a total of $320 million of LaSalle TIF funding for “LaSalle Street Reimagined” projects slated for 2025 and 2026, “underscoring the city’s commitment to revitalizing and reinventing its urban landscape.” Construction on the four approved projects are projected to start in early 2025.