Chicago has over 2,800 office-to-apartment conversions in the pipeline for 2024 and a total of over 5,100 in the works, outpacing most of its peer metros in the metric, a new report finds.
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The city has the fourth-most planned office-to-apartment conversions in the U.S. this year, trailing only Washington, D.C., New York City and Dallas, according to a RentCafe report. Chicago developers are set to bring 2,822 new apartments to the market via adaptive reuse of old office space.
Office-to-apartment projects make up 55% of all conversions nationally, followed by retail stores with 10.3% and community centers with 9.36%.
“The Chicago metropolitan area is making a mark in the world of adaptive reuse,” RentCafe wrote in the report. “Leading the movement is the massive project at 135 S. LaSalle St. in Chicago, the largest adaptive reuse endeavor in the metro. With 430 units, it's not just a big project; it's reshaping how people will live in the Windy City.”
Riverside Investment & Development and AmTrust Realty are leading the development at 135 S. LaSalle St., aiming to open the residential portion of the building in the first quarter of 2025, Crain’s Chicago Business reports. The estimated total cost of the project is $258M.
Another major conversion project on LaSalle Street is at 208. S. LaSalle St., spearheaded by The Prime Group. The developer intends to turn the five-floor block of office space above the distressed JW Marriott Chicago hotel and below its new LaSalle Hotel into 280 apartments with 84 affordable units, according to Crain’s. The project’s expected completion is September 2024.
The work Chicago developers are doing to convert old office properties will strengthen the attractiveness of the city to some of the top talent coming out of Big Ten schools throughout the Midwest, said Jeffrey Breaden, executive vice president of asset management and capital markets for The Prime Group, at Bisnow’s Chicago Repositioning And Conversions Summit in November.
Breaden said the conversion work his company is doing on LaSalle Street won’t “alter the path” of the city as much as it will reinforce the good things already happening downtown.
“These conversions give us opportunities to imitate great buildings in great locations and plan something that's highest and best use,” he said.
