The future of downtown’s troubled LaSalle Street corridor — and maybe the Loop itself — might have brightened a bit last week.
Once Chicago’s Wall Street, the LaSalle corridor has been rocked in recent years by vacancies caused by financial institutions and law firms relocating to new skyscrapers along the river.
With that in mind, the Chicago City Council made the right move Wednesday when it approved nearly $160 million in tax-exempt, multi-family housing revenue bond proceeds to go to two LaSalle Street projects.
The cash will help fund the conversion of major portions of 208 S. LaSalle St. and 111 W. Monroe St., both vintage office towers built for banking, into apartments, including some affordable units.
The projects are among four LaSalle Street corridor buildings that would be repurposed using the multi-family housing revenue bonds.
Chicago Department of Planning and Development Commissioner Ciere Boatright said the four projects together represent “one of the largest adaptive reuse efforts to move forward within any central business district” in the country.
‘Poster child’ for a new mixed-use Loop
The four projects are part of the LaSalle Street Reimagined initiative, started under Mayor Lori Lightfoot’s administration to bring mixed-income residences and neighborhood amenities to the area.
The bonds approved last week enable the city to borrow $70.5 million toward funding the Prime Group’s $123 million plan to turn four floors of 208 S. La Salle St. into 226 apartments, of which almost 70 will be affordable housing units. The construction will be subsidized by $26.2 million in tax increment financing dollars, expected to be approved this year.
In addition, $88 million in housing revenue bonds will assist Prime Group and Capri Capital Advisers LLC’s $202.8 million plan to create 345 units — 105 of them affordable — at 111 W. Monroe St. The developers are also seeking a $40 million TIF subsidy. Their plans also include constructing a 228-room hotel on the building’s lower floors.
In all four projects, affordable units would be set aside for tenants earning about $53,000 a year for a two-person household.
Boatright said the reborn buildings would become “poster children for the Loop’s rebirth as a mixed-use neighborhood.”
The key here is mixed use: Revitalizing downtowns —something many big cities are struggling to accomplish since the pandemic — will take more than converting office buildings into residences; strategies such as strengthening and growing arts, culture and entertainment areas, or turning to universities to create education or innovation hubs, are also important to consider, one Urban Institute expert pointed out in a January 2024 analysis.
Coach houses and basement apartments
We urge the City Council to move ahead, as well, with another proposal on the housing front: bringing back so-called “accessory dwelling units” that could help boost the stock of naturally occurring — meaning unsubsidized — affordable housing.
The City Council Zoning Committee met last week to discuss expanding citywide the 2021 pilot program that would allow homeowners to build accessory dwelling units, such as coach houses and basement or attic apartments, onto their existing homes, Crain’s Chicago Business first reported. The units have been effectively banned in the city since 1957 under tighter zoning restrictions.
The Zoning Committee could put the measure to a vote in the next few weeks. If approved, the expansion could face a full vote at next month’s City Council meeting. It’s a solid idea that deserves a “yes” vote from the committee and the full council.
The proposal has promise to become one more tool in the battle to create more affordable rental housing in the city. A pilot program was launched in 2020 in five areas across the city, but most of the building permits issued in the pilot are on the North and Northwest sides. A citywide program could help boost the idea in other neighborhoods, too.
Tens of millions in public subsidies are going to developers of the four LaSalle Street projects. The investment demands a sharp eye from City Hall to make sure the investment pays off — and LaSalle Street’s revival becomes the lifeline the Loop desperately needs.
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