Mike Reschke Completes Loop Office Seizure from Jay Shidler

Veteran Chicago developer Mike Reshcke finalized a $16 million takeover of the historic Burnham Center building in the Loop to resolve a foreclosure suit against its former owner.

The deal sets up a potential luxury hotel conversion Reshcke is considering for at least part of the 21-story, 584,000-square-foot property at 111 West Washington Street that was just 23 percent leased at the end of 2025, according to public records.

The project would become the latest of several office-to-hotel redevelopments Reschke has executed or currently is planning in Chicago. He wants to construct a luxury hotel with 250 to 300 keys in the middle floors of the Burnham Center and keep the rest of the building as offices, he told The Real Deal. The hotel will have a fine dining restaurant and bar on the northeast corner of Washington and Clark streets, he said.

The developer — whose firm, The Prime Group, partnered with Quintin Primo’s Capri Investment Group to redevelop the Thompson Center for Google in Chicago — paid $5 million last month to get the Burnham Center’s previous landlord Jay Shidler to walk away from the property, public records show.

Plus, Reschke paid an additional $10 million to $11 million in back taxes and delinquent bills owed by the last owner in order to take control of the distressed loan note for the property, he said Thursday at an event sponsored by office leasing brokerage Madison Rose at 150 North Michigan Avenue.

Hotel conversions are attractive to Reschke because the cost presents more certainty right now than the expense for office landlords to capture tenants, he said.

“The amount of concessions tenants are demanding because of the imbalance between availability and demand has never been so bad,” Reschke said, claiming that a $250 per square foot package was requested by a prospective tenant of the Jeweler’s Building he also bought out of distress in 2024 with partner Clayco.

“The concession packages are tough. Office rents are not where I’d hoped they’d be. You gotta be really careful buying these buildings, whether you pay $50 a foot or $200 a foot, because it’s the next $200 or $250, plus carry cost, plus down time to get them leased up and stabilized,” Reschke said.

He also plans to convert Loop office buildings at 111 West Monroe — where he’s also partnering with Primo and will include a 228-room hotel component — and 208 South LaSalle streets into apartments. But he said it’s necessary to get them designated as historic buildings to receive subsidies to make the financials work.

“Office is not an easy game. It’s a lot easier to just buy a building with a business plan to demolish everything inside and convert it to a luxury hotel. I know what those numbers are, and I don’t have to worry about negotiating with 50 tenants,” Reshcke said.

Retreat from Chicago

Honolulu, Hawaii-based Shidler Group’s departure from the Burnham Center marks the firm’s latest exit from a Chicago office building where its ground lease strategy sunk a project into financial trouble. Shidler’s penchant for separating the ownership of a property’s building from the land beneath it sent deals at both buildings at 300 West Adams Street and Triangle Plaza near O’Hare International Airport into distress. That resulted in lenders taking control of both properties during the post-pandemic downturn.

At the Burnham Center, Shidler’s ground lease strategy culminated in a $42 million Wells Fargo foreclosure lawsuit in July 2024 against Shidler’s ground ownership venture. That followed the former building owner, Chicago-based Golub & Company, defaulting on its land rent arrangement with Shidler’s firm. An affiliate of Shidler didn’t return a request for comment on Friday, and Golub declined to comment.

Golub ran into issues at the building in March 2024 when tenant GrubHub ditched the Burnham Center — where it previously leased 164,000 square feet — to rent a smaller office space at the Merchandise Mart. Golub took out a $75 million loan from CIT Group (which is now a division of First Citizens Bank) against the building portion of the property in 2019 to fund its $80 million purchase. But the ground lease arrangement and Shidler’s additional debt against the land portion of the property weighed too heavily on the building as its performance declined.

The Burnham Center was one of famed architect Daniel Burnham’s last two projects before he died in 1912. His final project was the Filene’s Department Store now known as the Burnham Building in Boston.