Chicago Opens First Loop Office-to-Housing Conversion, the Bellwether
Chicago completes the Bellwether, its first Loop office-to-housing conversion, delivering 117 mixed-income units with 41 affordable homes and $28 million in city TIF support.
- Section
- Renovation & Retrofit
- Author
- By Grace Kim
- Filed
- Length
- 2 min read
Key takeaways
- The Bellwether, a conversion of the 14-story, 121-year-old Rector building, is the first completed office-to-housing project in Chicago's Loop, delivering 117 residential units, 41 of them affordable at an average of 60% of area median income.
- The project used $28 million in city tax increment financing plus $7.8 million in federal tax credits enabled by a historic landmark designation.
- The Bellwether is the first of six projects under Chicago's LaSalle Street Reimagined initiative targeting 1,765 mixed-income units; nearly two dozen private conversions could add close to 4,000 more units.
Chicago has completed the first office-to-housing conversion in its central business district, the Loop, turning 11 floors of unused office space in a 121-year-old tower into 117 mixed-income residential units.
The project, now known as the Bellwether, redeveloped the 14-story Rector building with $28 million in tax increment financing from the city and a historic landmark designation that unlocked $7.8 million in federal tax credits. Of the 117 units, 41 are earmarked for households earning an average of 60% of the area median income, according to the city.
City leaders gathered downtown last month to mark the milestone. "The Bellwether is the vanguard for downtown office conversions that are reimagining what it means … to live, work, and play in the heart of Chicago," Ciere Boatright, commissioner of the Chicago Department of Planning and Development, said in a news release.
The Bellwether is the first of six office conversion projects the DPD is pursuing under the LaSalle Street Reimagined initiative, which aims to convert unused office space into 1,765 mixed-income housing units.
The initiative arrives amid affordable housing shortages and record-high office vacancies downtown. Chicago is short 119,000 affordable housing units, according to Mayor Brandon Johnson, and more than 51% of the city's residents are considered cost-burdened, spending over 30% of their income on rent and utilities.
The Bellwether also carries a broader national signal. As working habits change post-pandemic, adaptive reuse projects for office buildings are accelerating in major U.S. cities. New York City and Washington, D.C., lead the country in office-to-apartment conversions, with Chicago ranking third, according to RentCafe.
Developer R2 partnered on the project. "The completion of the Bellwether demonstrates what is possible when we look at Chicago's historic downtown assets with fresh eyes and invest in their next chapter," Gary Stoltz, a partner with R2, said in a statement. "This project reflects our belief that the Loop's future will be defined by a dynamic mix of people who live, work and spend time here."
Beyond city-backed initiatives, Chicago has nearly two dozen private office-building conversions in the pipeline, expected to create close to 4,000 new residential units. With five more LaSalle Street Reimagined projects still ahead, the Bellwether's completion positions the Loop as a test case for whether targeted public financing can convert vacancy into housing at scale.
Original: techtarget.com
