Reschke scores $113M refinance for Loop hotel 

Chicago developer Michael Reschke secured new financing for a downtown hotel he owns, a  triumph in today’s lending environment. 

A venture of Reschke’s Prime Group has refinanced the 381-key Residence Inn Chicago at 11 South LaSalle Street with a $113 million loan from an affiliate of Washington, D.C.-based Union Labor Life Insurance, Crain’s reported. 

The loan replaces a $141 million mortgage from Goldman Sachs that Reschke had obtained in early 2021 and was set to mature in February. To pay off the Goldman Sachs loan, Reschke had to inject $28 million in new equity, showcasing the difficulties property owners face in refinancing in a tight lending climate, amid economic uncertainty. Terms of the loan were not disclosed.

“Following the pandemic years, the Residence Inn Chicago Downtown/Loop has staged an impressive recovery due to its exceptional quality, iconic downtown location, talented operations team and intense focus on guest satisfaction,” Reschke told the outlet. “Through these factors and despite a volatile capital markets environment, we are pleased to secure attractive permanent financing.”

Reschke has a longstanding relationship with Union Labor Life. In 2008, the insurance company was among a group of lenders that provided a massive construction loan for Prime Group’s redevelopment of 208 South LaSalle Street into the JW Marriott Chicago.

The recent refinancing deal highlights Reschke’s belief in the hotel’s potential, as Chicago’s lodging industry continues to bounce back from the pandemic. While leisure travel has surged this year, business travel, a key driver for LaSalle Street hotels, has been slower to return. 

Despite those challenges, Reschke remains optimistic about the downtown hotel market, as indicated by his ongoing hospitality projects, including a partnership with Riu Hotels & Resorts and negotiations to acquire the landmark Jewelers Building for a potential conversion into a hotel.

Separately, Reschke and fellow real estate heavyweight Quintin Primo are leading the highly-anticipated redevelopment of the Thompson Center, which Google plans to move into in 2026. 

—Quinn Donoghue