Mavrek Development is set to join forces with Acres Capital to transform a mostly-vacant Loop office property into a residential building.
The building, 209 West Jackson Boulevard, is the latest in a long series of Downtown Chicago office-to-residential conversions, according to Crain’s. Rental prices are through the roof in the area due to the lack of a robust construction pipeline, and office space downtown still has high vacancy rates after the work-from-home pandemic shift.
209 West Jackson Boulevard will be converted into around 180 apartments over 12 stories worth of space. The building itself dates back to 1896, was renovated in 2019, and was taken over by an affiliate of Uniondale, New York-based Acres in 2023 by deed in lieu of foreclosure, according to the outlet. It has a notably high vacancy rate of around 70 percent, indicative of many other similar office properties across Downtown Chicago, according to CoStar data. The completion target is early 2029.
The $90 million renovation of 209 West Jackson Boulevard is the second development Acres and Mavrek have partnered on. They’re spearheading the conversion of another longstanding Chicago building for about the same $90 million price tag: 65 East Wacker Place, known as the Millinery Mart Building. Completed in 1928, it will be converted into 252 apartments across 24 stories.
The 65 East Wacker project scored a $62.4 million senior construction loan from Derby Lane Partners, $17 million in historic preservation tax credits, and an $11 million loan from Hoyne Savings Bank, according to the outlet.
A good chunk of Chicago’s run of office-to-residential conversions are being partially funded by the city, but Mavrek and Acre’s projects are some of the first privately-funded projects in the downtown area. Many developers are tapping into Tax Increment Financing to fund sweeping renovations for the high cost of restoring old, historic buildings. This method of financing needed redevelopment is primarily felt along LaSalle Street, as part of the LaSalle Street Reimagined initiative.
— Hunter Cooke
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