By Bob Spoerl
October 19, 2010
A sluggish real-estate market and the recently scrapped plans to build the Spire Tower are both part of dwindling development downtown.
In the shadows of a recession, the city’s skyline will likely look the same for some time, according to Gail Lissner, a downtown real estate appraiser.
“Nobody is putting a shovel in the ground anymore,” said Lissner, vice president of Appraisal Research Counselors.
Current foreclosure rates in the Loop are more than 100 percent higher than this time last year, according to data compiled by the Woodstock Institute, an economic and housing research group. After two quarters in 2009, there were 60 foreclosures filed in the Loop, compared to the 132 filed in the first two quarters of 2010.
Lissner said she expects no condominium development in the Loop for the next few years, but a potential influx in upscale high-rise buildings for rent.
“When people are uncertain about their future, their jobs and the market, they tend to gravitate toward rental housing,” Lissner said.
Charles Huzenis, president of the Jameson Realty Group, echoed that opinion.
“You’re not going to see a lot of high-end units built for seven, eight, maybe 10 years,” he said.
Huzenis said he is confident that if the economy improves over the next few years, a surge of homeowners in the North Shore and western suburbs will move to the city.
“There is plenty who would like to move back to the city, but they are waiting for the time when they can actually sell their homes,” Huzenis said.
Currently, there are 2,500 vacant units in the Loop in recently developed condominiums, according to Lissner.
High rises with plenty of studio or one-bedroom units for rent, might be the future of downtown development, according to Lissner and Huzenis. If a developer finds funding for the next ambitious architectural project though, Chicago zoning officials will consider it.
“As long as there is demand and finance for the space available, skyscrapers will be built,” Pete Strazzabosco, a spokesperson for the city’s zoning and land use department, said.
Spire Tower, planned for a 2.2-acre lot at 400 N. Lake Shore Dr., would have been 150 stories high, surpassing the CN Tower in Toronto as North America’s tallest building. Famed Spanish architect Santiago Calatrava, known for designing the Milwaukee Public Art Museum and a high-rise in Sweden that resembles a turning human body, drew up the plans for Spire Tower, which began construction in 2007.
Richard Nagemgast, a healthcare financial advisor who works several blocks from where Spire would have stood, said he hopes the project is somehow saved.
“I’d love to see it resurrected. It would have been a really handsome and innovative design to add to the city skyline,” Nagemgast said.
Construction projects in Chicago have six years before the plan expires. Soon, the hole-in-the ground on Lake Shore Drive may be the property of the Anglo Irish Bank Corp. after it filed a lawsuit against Spire’s Irish developer Garrett Kelleher last week.