It’s Halloween season, and, what do you know, development plans are stirring at a site that for years has been a financial dead zone.
The property is 400 N. Lake Shore Drive in Streeterville, situated along Chicago’s front door where the river meets Lake Michigan and boats pass through locks to get from one to the other. It’s the old Chicago Spire site, although the current owner, Related Midwest, is irritated when anyone invokes that name.
Related acquired the site in 2014 via bankruptcy court. It was vacant, but prior developer Garrett Kelleher left behind a 76-foot-deep crater that was to be the foundation of a fanciful curvy building.
Designed by “starchitect,” or celebrity architect, Santiago Calatrava, the condo tower would have been 2,000 feet tall, making it the tallest in the Western Hemisphere. New York’s 1 World Trade Center was deemed the tallest at 1,776 feet by the Council on Tall Buildings and Urban Habitat.
Active in both downtown high-rises and affordable housing, Related had a more doable plan for the 2.2 acres. It scrapped the spire and went with a shorter but still substantial two-tower design by Skidmore, Owings & Merrill. The SOM plan is modest in architectural ambition but uses setbacks and terra cotta accents to reference classic Chicago buildings.
The city approved the plans in 2020, but the pandemic and attendant financial upheaval put things on hold. Back then, Related estimated the total cost at $1 billion.
Now, Related intends to begin construction on one of the two buildings. It would be the northernmost tower, the taller one at 840 feet, or 74 stories, with 635 rental apartments.
During a virtual community meeting last week, Related executives said they hope to start construction in about 45 days, roughly Dec. 1, and complete the tower in the third quarter of 2027. It’s a bold move, given that inflation has made developers reconsider ground-up construction and doubts still linger about the pandemic’s effect on demand to live downtown.
Nick Millot, vice president at Related Midwest, hinted at the bold nature of the venture, telling community members, “We’re going to be one of the few [construction] cranes in the city of Chicago over the next few years.”
The meeting itself was short and given over mostly to how Related plans to handle getting construction equipment into and out of the site, which has many nearby high-rises, including Related’s One Bennett Park.
Construction generally will be from 8 a.m. to 8 p.m. Monday through Friday, Millot said.
Related President Curt Bailey emphasized the company’s intention to minimize noise and disruption. “We want to be great neighbors. We love Streeterville. I live in Streeterville,” he said.
The project is a bet on how the rental market might look when the building is delivered. While there’s much risk involved, it appears Related holds a financial ace.
The Illinois Housing Development Authority is finalizing a $510 million financing package for the project, a mix of tax-free and taxable bonds. The second tower, approved at 765 feet tall and 500 rental units, could still be years off.
Veteran developer John Murphy, chairman of Murphy Real Estate Services, said the project could benefit from a lack of new construction downtown.
“It’s a great site, and they’re showing very high rents there. You can rationalize this,” said Murphy, who is not involved in the project.
IHDA spokesman Andrew Field said 400 N. Lake Shore Drive would be financed as part of the agency’s push for affordable housing. Twenty percent of the first building’s 635 units will be set aside for low-income renters.
Gail Spreen, co-chairwoman of the development committee for the Streeterville Organization of Active Residents, said people are glad to see plans move forward and support the affordability component. Spreen said she hopes the apartments will draw medical staff who work nearby and who otherwise may be unable to afford Streeterville.
Downtown Ald. Brendan Reilly (42nd), who alerted residents that Related planned to start its work, could not be reached for comment.
He has supported the design scheme since 2010 after convincing the developer to adopt several changes.
At Reilly’s insistence, Related dropped plans for a hotel in one of the buildings and eliminated a podium that many thought deadened the project’s interaction with the street. Parking for the development will be below grade.
As part of the development deal, Related has agreed to donate $10 million to the Chicago Park District for its future DuSable Park immediately east of the development and Lake Shore Drive.
As for that stubborn hole, it will come in handy for subterranean construction. A Related spokeswoman said the northern tower’s foundation and garage will fill and cover it, while also using some of its caissons.
Calatrava, by the way, still lists the Chicago Spire on his website, almost as if he wants some besotted financier to give the design a whirl.
