A pair of mid-sized towers will be added to the skyline of downtown Chicago in 2024 after a $350 million mixed-use development proposal received final approval from the city.
The Chicago City Council unanimously voted in favor of a zoning change request for a residential and hotel development proposed by the Illinois-based developer Eterra Plus to build a 23-story and a 36-story building connected by a commercial and parking base at 523-45 South Wabash Avenue.
The two buildings, designed by BKV Group, will have 777 rental units and 314 hotel rooms, replacing an existing parking garage and a parking lot. The new construction will also have about 42,000 square feet of commercial space on the first and second floors of the buildings. Construction is expected to be completed in 2024.
The project will also build 78 affordable units, consisting of studios, one-bedroom, two-bedroom and three bedroom units, located on site to meet the city’s affordable housing requirements. It’s part of Chicago Mayor Lori Lightfoot’s initiative to increase the amount of required affordable housing units in new construction.
Tuesday’s vote followed approvals by the Chicago Plan Commission in August and the city council’s Committee on Zoning, Landmarks and Building Standards last week.
The city council’s approval comes at a time when Chicago’s office vacancy rates are hitting record highs while occupancy rates in downtown apartments have been soaring.
It’s a little too early to tell how the downtown rental and housing markets will look like in 2024, said Benjamin Creamer, principal of Downtown Apartment Company, but he remains optimistic.
“Over the years, the downtown has been able to absorb new development and I think a lot of it is still driven by the job market,” said Creamer. Cramer noted that demand for rentals and condominiums have kept up over more than 10 years and the Loop is an attractive option for Chicagoans due to the proximity to an expressway, as well as the space it offers compared with other areas in downtown.
In downtown Chicago, about 11,530 apartments will be delivered by the second quarter of 2023, according to a Marcus & Millichap’s market report. This is about 78 percent more than the 6,463 units completed during the 12 month period ended in June.