The colonization of the Loop by residential buildings will get a big boost when the Block 37 project finally gets going.
Sources at JMB Realty Group, which controls the property bounded by State, Randolph, Washington and Dearborn Streets, say condominiums are now included in the plan as well as a Macy’s department store, a Marriott hotel and retail, restaurant and entertainment venues.
The condo project, which would take the form of a 300-unit tower atop the 350-room hotel, would be only a block or so from the planned project by developer Scott Toberman for a new world’s tallest building at Dearborn and Madison Streets, which would include about 200 condos.
The construction of condos in the Loop follows the growing trend of converting older Loop office buildings into condos, rental apartments, hotels and student residences.
The Block 37 condo plan is a new twist in the long-running drama of the project, which appears to illustrate the concept of brilliant inaction.
Back in the 1980s when the project was conceived, almost no one thought of living in the Loop. Now the long delay–which has subjected the city and JMB to considerable ridicule–may enable the company to catch a rising tide.
The official announcement of the overall project still awaits the result of somewhat fitful negotiations between JMB, the city and Macy’s, a division of Federated Department Stores Inc., on a deal to have Macy’s bring a major emporium to the block.
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A meeting of the parties scheduled last month is now set for this month, with the major issue expected to be a request by Macy’s for some tax increment finance money from the city.
“Macy’s wants to do a deal,” insisted JMB President Neil Bluhm. “That bridge has been crossed.”
Bluhm expressed hope that an agreement among the parties could be reached by this fall, though he couldn’t give an estimated time when construction will start.
His enthusiasm isn’t flagging, however. State Street “is like a regional mall,” he said. “You have to think of it in terms of retail excitement.”
Well developed: One indication of the strength of the construction side of the real estate market these days is the decision by LaSalle Partners Inc. to expand its development business.
LaSalle emerged from the late 1980s real estate crash in a position of relative strength, in part because it shunned the major development investments that ended up crippling some of its rivals.
The Chicago company has gone on to become a national and global commercial real estate giant, swallowing weaker firms as it grows.
Now the firm has formed a new subsidiary, LaSalle Partners Development Inc., to beef up its development business in response to the new construction boom.
The move also draws on the development expertise of the former Galbreath Co., the Columbus, Ohio-based firm that LaSalle snapped up last year, which had recognized strengths in that area.
Paul Bryan, chief executive of the new group and a former Galbreath executive, said LaSalle is cautiously investing some of its own capital with partners in new development as well as continuing to pursue its fee development management business.
But Bryan made clear LaSalle isn’t throwing caution away.
“We are conservative. That may be an oxymoron with most developers, but we think we can have an appropriate balance and be effective while being consistent with the risk-averse nature of LaSalle.”
Matchmaker: The whirlwind of consolidation in the real estate industry has spawned its own niche business.
Barbara Mitalo, former director of franchise sales and development for Century 21 in northern Illinois, has started Quest Solutions, a Barrington-based consulting firm formed to help real estate companies acquire other real estate companies–primarily in the residential field.
“The best way to jump-start a real estate business . . . is to acquire another company or merge with one,” said Mitalo, who described herself as a matchmaker.
“The little guys know they don’t have a chance anymore,” she added.