Feb 25, 2009

Housing Bulletin

Housing Bulletin: Coming Out on Top in the Loop

For high-quality mode select “HQ” from the menu on the bottom right of the video
 

Last week, the first four buyers closed on their condos in one of the city’s most improbable building conversions, the top ten floors of the slab-like, 50-story 55 E. Monroe office building, which has been transformed into a residential block called Park Monroe.

Two of the condos are on the building’s more expensive east side, where condos look out from above the historic Michigan Avenue streetwall toward Grant and Millennium parks and the lake; their prices were $1,151,170, for a 43rd-floor two-bedroom condo with a den, and $726,222, for a two-bedroom condo on the same floor. The two west-facing units—on the 42nd and 44th floors, with views over the Loop—went for $494,952 (two bedrooms) and $341,005 (one bedroom). According to the developers, more closings are scheduled for today and Friday. 

All those condos are among the 130 units at Park Monroe that have sale contracts—that’s out of 162 condos available on the nine residential floors (the 12 penthouses have second levels on the tenth residential floor, which also houses the pool and other building amenities). Rand Diamond, principal at GlenStar Properties, which did the conversion in a joint venture with Walton Street Capital, says that the great majority of those units had been sold by a year ago, with only a few sales since the residential real-estate downturn.

The developers originally planned to convert 14 floors in two phases of seven each; instead, they are doing ten floors in one phase. Diamond says that’s a response to the downturn, but he adds that much of the unconverted space has been spoken for by office tenants already in the building.

But even with the slowdown, the Park Monroe is benefiting from its Loop location, with the Art Institute, Symphony Center, and Millennium Park within a few blocks. In its latest report on the city condo market (released last week), Appraisal Research Counselors showed that Loop condo projects have suffered the least: while only about 50 percent of the new units delivering this year in the South Loop and the West Loop have sale contracts, more than 90 percent of new Loop condos have been sold.

Converting the top section of the tower—built in 1972 as Mid-Continental Plaza—from office space to residences was “very complicated,” Diamond says. One thing that had to be overcome was the typical office floor’s vastness: each floor here is nearly an acre in size. Condo owners don’t want to exit the elevators into a sea of space. Angles and bends in the new interior hallways were designed to break up the space, but it still feels like a long walk from the elevator to some of a floor’s 26 condos.

The residential floors had to be separated from the office floors both as legal entities and mechanically—meaning they had to have separate elevators, heating and air conditioning, and plumbing. That’s easily done when you are putting up a new building, but this one already existed as one big entity. The resulting separation is so complete, Diamond says, that the two entities “might as well be buildings that are next door to each other.”

But they aren’t, and the fact that the condos sit atop the offices is what makes them intriguing. Only recently has it been possible to see clearly from the outside how the segments of the building are differentiated: while the lower floors still have vertical ribs or mullions spaced five feet apart running up their sides, on the condo floors every other rib has been removed, creating a much wider opening for windows and balconies. (The removed mullions were not structural; they contained ductwork for the heat and air conditioning, both of which are now handled elsewhere.)

I like the difference between the upper and lower parts of the tower, but not everybody does. To them, I would point out the precedent, visible in the photo above: the old Illinois Athletic Club, an ornate 12-story structure built in 1908 at 112 South Michigan Avenue, has a very discordant upper part, six stories that were plunked on top of it in 1985.
 

Posted at 07:21 AM in Housing Bulletin | Permalink

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