Tall & Urban News

How high-rise living has transformed Chicago's skyline

The great Chicago apartment boom reshaped the city’s skyline with dozens of fancy new high-rises. But it didn’t reach the heights of the condo craze the decade before.

The skyline gained nearly 28,000 vertical feet (8,534 meters)—the equivalent of 20 Willis Towers—from 2010 through 2019, as developers built apartment towers as fast as they could, according to CTBUH. They filled out a forest of high-rises that has been growing since 1885, when what was considered the world’s first skyscraper, the Home Insurance Building, opened at Adams and LaSalle streets.

Though last decade was busy, an analysis of data from the council shows that the prior 10 years, when condominiums were the rage, actually delivered more vertical growth to Chicago. From 2000 through 2009, the skyline gained more than 34,000 feet—more than 6 miles—if you stacked all 66 tall buildings completed during that period on top of each other. It was the busiest decade for high-rise construction in Chicago since at least 1970, according to the Chicago nonprofit, which tracks skyscrapers around the world.

The 50 years of construction data also underscore the broader shift underway in Chicago and other US cities since the turn of the century, as downtown high-rise living has become en vogue. Though developers keep building office towers downtown, these days most of the action is in residential, whether it’s condos or apartments.

Office projects accounted for 48 percent of the 106 tall buildings completed in the 1970s and 1980s, with residential comprising 52 percent, according to the council’s data, which encompasses projects at least 100 meters, or 328 feet, tall.

But of the 123 tall buildings completed in the first two decades of the 21st century, office developers’ share of the pie shrunk to just 11 percent. Residential projects accounted for 78 percent of all tall buildings completed from 2000 through 2019. Recent additions include One Bennett Park, a 67-story apartment-and-condo tower in Streeterville, and NEMA Chicago, an 81-story apartment building in the South Loop.

“It’s more about people being interested in the (urban) lifestyle and being connected,” said Daniel Safarik, editor-in-chief of the CTBUH. “There’s a lot of high-rise residential popping up in areas where we wouldn’t have seen it 10 to 15 years ago.”

The big question is what the next 10 to 15 years will bring. Will urban life and the business of high-rise construction go back to normal after the coronavirus pandemic passes? Or will the virus set big cities like Chicago on a different course?

It’s way too early to tell, but some trendspotters are already debating whether the contagion could diminish the appeal of high-density urban living as people try to minimize contact with others. That could slow the construction of residential high-rises. Others predict that a further acceleration in the work-from-home trend will reduce demand for space in big downtown office towers.

With construction considered an essential business under Gov. J.B. Pritzker’s “stay home” order, work on the city’s tall buildings continues unabated. That includes One Chicago Square East, a 76-story residential tower under construction in River North. Twelve tall buildings totaling more than 8,000 vertical feet (2,434 meters) are under construction as of March 2020 in the city, and all but two are residential, according to the council.

The total for the current decade will depend heavily on what happens to the economy and lending markets. A deep and prolonged recession would depress demand for all kinds of real estate. Debt and equity financing for new high-rises would dry up, too.

Though construction financing will be unavailable for the next 60 to 90 days, it should come back after that, said Jim Letchinger, One Chicago’s developer.

“We had already slowed down on new developments, but this will really slow it down in the near term,” said Letchinger, founder and CEO of Chicago-based JDL Development, which scored its financing for One Chicago last year.

High-rise construction appears to lag recessions because of the two years or more it typically takes to develop a tall building. Construction often continues even in the depths of a downturn because developers usually have their financing in place. Once they’ve started, they don’t have any incentive to stop.

Amid the severe downturn in commercial real estate in the early 1990s, tall building development ground to a halt. As a result, developers didn’t complete a single big project in Chicago between 1993 and 1997, according to the council. They delivered just three more buildings in the city that decade, the weakest 10-year period for high-rise construction of the last 50.

Construction didn’t slow much during and after the brief recession of 2001. Developers spent the next several years putting up one condo tower after another, and dozens of downtown projects were already underway when the Great Recession hit in late 2007. Amid one of the worst real estate downturns of the postwar era, developers completed 13 high-rises in Chicago in 2009 and another 13 in 2010, the two biggest years for high-rise development in the city since at least 1970.

Once home to the world’s tallest building, Chicago is no longer a global hot spot when it comes to tall-building construction. Architects, especially those that specialize in super-tall construction, have been more busy with big commissions in places like China.

With 126 buildings over 150 meters tall, Chicago ranks a distant second in North America behind New York City, which has 284, according to the CTBUH. And the council projects that Chicago will soon drop to third after Toronto, which is in the midst of a construction frenzy.

Chicago’s recent apartment boom also has delivered few memorable buildings with bold, innovative designs, Safarik said. Most have been a variation of the glass box.

“The march of the bland and uninspiring continues,” Safarik said. “If you want to see interesting apartment buildings or towers, I don’t think Chicago is your place.”

To see the original story, go to Crain's.