LaSalle Street joint venture seeks office-to-apartment conversion without subsidies

In a move signaling impatience with the city’s LaSalle Street Reimagined initiative, a Chicago joint venture is seeking approval to convert part of an office building into apartments.

Corebridge Financial and developer Golub are looking to convert a portion of 30 North LaSalle Street. into 349 apartments, but with a twist, Crain’s Chicago reported, citing a recent zoning application introduced to the City Council. 

A similar proposal was submitted earlier under former Mayor Lori Lightfoot’s LaSalle Street initiative, but Corebridge and Golub say they can proceed without city subsidies, public financing, or the obligation to include affordable housing units, the outlet said.

The zoning application, if approved, would allow the project to move forward “as of right,” eliminating the need for a zoning change, meaning the developers can bypass compliance with the city’s affordable housing ordinance. (The measure typically requires at least 20 percent of units in new apartment projects to be affordable for tenants with an average income no more than 60 percent of the Chicago area’s median income.)

The proposal comes at a time when the future of Lightfoot’s LaSalle Street initiative remains uncertain under Mayor Brandon Johnson. The Johnson administration has not clarified its stance on the program, leaving several development teams, including Corebridge and Golub, in limbo as they await a green light to move forward with their LaSalle Street Reimagined projects.

Since the selection of 30 North LaSalle and four other projects for the program in May, the city has been engaged in an underwriting process to determine public financing for the estimated $1 billion worth of projects. The developers, collectively seeking over $300 million in tax-increment financing assistance, face uncertainty as the Johnson administration’s approach to the LaSalle Street initiative remains unclear.

Johnson has raised concerns about the viability of the initiative, which is aimed at revitalizing the LaSalle Street corridor by transforming vacant office space into residences, while reserving at least 30 percent of the new housing units as affordable,

In response to the evolving situation, the Corebridge-Golub venture is exploring an alternative path. Their zoning application seeks City Council approval to “sunset” the planned development governing allowable uses at 30 North LaSalle, reverting the property back to its underlying zoning. If approved, this would enable the construction of up to 349 residential units without the need for a new planned development. However, questions linger about whether that would trigger compliance with the affordable housing ordinance.

While the underwriting process may still result in a redevelopment agreement between the city and Corebridge-Golub, the uncertainty has prompted the building owners to consider alternative avenues without taxpayer help. Golub’s earlier estimate for the LaSalle Street Reimagined project was around $143 million, with the joint venture seeking $62 million in tax-increment financing, the outlet said.

— Ted Glanzer