Office Conversion Pipeline Grows
The national pipeline of office-to-residential conversions has surpassed 80,000 units, signaling a potential future supply shock in core urban markets. While no new conversion projects have been announced specifically for the Gold Coast, this trend represents a long-term risk. A sudden influx of new inventory from such projects could eventually put downward pressure on rents and occupancy.
- The city’s "LaSalle Street Reimagined" initiative is a primary driver of the office-to-residential conversion trend in Chicago, aiming to transform the historic financial corridor into a mixed-use neighborhood. This program is set to introduce over 1,000 new apartments to the Loop, with more than 300 of them designated as affordable. - Five major conversion projects have been announced as part of this initiative, representing nearly $1 billion in investment. These projects are expected to repurpose approximately 1.6 million square feet of vacant office space and reduce the LaSalle corridor's commercial vacancy by nearly 50%. - Your employer, Golub & Company, is a key participant in this initiative with the redevelopment of 30 N. LaSalle. This project will convert the lower floors of the 44-story tower into 349 apartments, with 105 of them being affordable units. The total cost is projected to be $135 million, supported by $57 million in Tax Increment Financing (TIF). - While a formal construction timeline for 30 N. LaSalle has not been announced, the project has received city approvals for its design and TIF funding, indicating it is moving forward. The earliest potential completion date cited was early 2025, though a more recent estimate points to January 2027. - The new supply is not limited to conversions; a new 28-story luxury apartment tower with 307 units has been proposed for the Gold Coast at 1120-1130 N. State Street by developer Convexity Properties. This project is planned to start construction in June 2026 with a completion target of spring 2028. - Despite the influx of new units from conversions, the overall downtown apartment supply is expected to remain tight. Projections for 2025-2027 show a significantly lower number of new apartment deliveries compared to the previous decade's annual average. - The Gold Coast/Old Town submarket has seen some of the highest rent increases in downtown Chicago, with a 9% gain in the second quarter of 2025. However, this area also experienced a significant 18% year-over-year decline in leasing activity during the same period, suggesting some market softening. - Nationally, the pipeline for office-to-apartment conversions has grown significantly, from 12,100 units in 2021 to over 70,700 in 2025, indicating a sustained trend of adaptive reuse.
