Developers Still Ready To Take Big Chances On Downtown
The coronavirus pandemic took bites out of downtown Chicago’s multifamily and hospitality sectors, but a pair of developers still see long-term promise for both.
Northfield, Illinois-based Eterra Plus and Miami-based Crescent Heights have proposed developing three towers, bringing a total of about 1,200 apartments and more than 300 hotel rooms to the South Loop and West Loop neighborhoods, according to the Chicago Tribune, citing an email from 42nd Ward Alderman Brendan Reilly to his constituents.
Other major downtown projects have gone forward despite the coronavirus pandemic. That includes rising towers such as the 813-foot, 1.2M SF Salesforce Tower, which Hines recently began building at Wolf Point along the Chicago River, and Sterling Bay’s 47-story mixed-use tower at 300 North Michigan Ave., which it is developing in partnership with Magellan Development Group.
But those projects typically had tenants in place before the pandemic, as well as complex financing deals arranged and other contracts signed. Eterra Plus and Crescent Heights may face bigger tests. Both will need to find tenants and investors willing to make bets on the downtown market as new vaccines help it recover.
The developers say they are ready for those challenges.
“We believe in the continued theme of a ‘work-live-play’ dynamic and believe the site offers the same, if not more, of the attributes post-COVID as it did pre-COVID,” Crescent Heights Vice President Jason Buchberg told the Tribune in an email. “We are thinking about ways within the asset to provide even more individualized breakout/work spaces as well as re-imagining traditional amenities and services offered.
“Obviously, the market is a bit more challenging today but we are investors in the future and believe Chicago is positioned to weather the storm.”
Crescent Heights submitted plans to build a 413-unit apartment tower in the West Loop, replacing a parking lot the firm bought last spring at 640 West Washington Blvd., just east of the Kennedy Expressway. Hartshorne Plunkard Architecture designed the 47-story tower.
The developer already has a great deal of experience in the downtown multifamily market. In 2019, it opened NEMA Chicago, an 800-unit, 76-story apartment tower that overlooks the southern half of Grant Park at 1210 South Indiana Ave.
Eterra Plus wants to replace a South Loop parking structure at 525 South Wabash Ave. with two towers, one with 23 stories, 314 hotel rooms and 261 apartments, and another comprising 36 stories and 516 apartments. Eterra Director Kristopher Plencner told the Tribune that the developer plans to start construction by next fall and complete the $300M project in 2024.