The James R. Thompson Center was for decades downtown’s epicenter of state government, a home for departments ranging from the governor’s office to a driver services facility. Now the 17-story curved glass tower — an exemplar of postmodern architecture — stands forlornly empty, with signs affixed to its entryways announcing in big red letters: “The Driver Services Facility Has Moved Across the Street.” But come mid-2026, the old haunt is expected to crackle with new vigor as Google opens a second regional headquarters there, expanding beyond its base in Fulton Market.

On top of bringing along thousands of well-paid employees, Google is sparking hopes of a turnaround of economically distressed — some would say depressed — La Salle Street, which runs along the Thompson Center’s west edge. Once among the most robust business corridors in the country, it is reeling from corporate restructurings, employee downsizing, and disruptions spawned by the pandemic and the remote-work era. The result: a historic office building vacancy rate of more than 25 percent and climbing.

Adding to the strain: Some community, corporate, and real estate interests question whether Mayor Brandon Johnson is on board with the city’s 2022 rescue plan, La Salle Street Reimagined. City Hall didn’t respond to Chicago’s emails requesting comment, but when pressed to talk about La Salle Street late last year by the Sun-Times, Johnson stopped short of coming out in favor of the rescue plan, insisting instead that Chicago has “the fastest-growing downtown anywhere in the country.” His 2024 budget does not include any of the public subsidies for the revamp that had been expected.

The ambitious rescue plan, hatched under Johnson’s predecessor, Lori Lightfoot, envisions remaking La Salle Street between Randolph and Van Buren into a mixed-use neighborhood brimming with young, diverse workers and families enjoying new residential dwellings, restaurants, bars, entertainment venues, and a supermarket.

“Google is proof that downtown is not dead, but its entry is only part of the solution. We need more,” says Scott Henry, a founder of Celadon Partners, which is looking to redevelop a 41-story site at 105 West Adams Street, next to the Rookery, the landmark building at 209 South La Salle. The Celadon project is among five La Salle Street Reimagined efforts approved by the Lightfoot administration. But developers are counting on Johnson for city-backed financing to help fund additional ones.

Named after the 17th-century French explorer René-Robert Cavelier, Sieur de La Salle, the corridor is known for towering art deco office buildings. It’s been an atmospheric backdrop for The Dark Knight and The Untouchables. In recent years, major tenants, including BMO Bank and Bank of America, moved out, taking thousands of workers. That exodus of bankers, lawyers, and rank-and-file staffers — on top of pandemic cutbacks — doomed many restaurants and stores, resulting in a 2022 retail vacancy rate of 36 percent in the corridor, the city estimates.

A recent walk down La Salle found rows of empty storefronts and “For Rent” signs on office buildings, despite the Chicago Board of Trade and the Chicago Federal Reserve Bank anchoring its south end. Also missing is a sense of the activity that’s felt in livelier areas such as River North and the West Loop. Unless this dynamic changes, La Salle Street will continue losing tenants while failing to attract new ones, caution real estate experts. “Companies want employees to enjoy where they work,” says Eric Feinberg, vice chair and cohead of the Chicago region for Savills, an international commercial real estate advisory firm. “The best way is to offer an energized environment with a more ‘work, play, and live’ aspect.”

“Google is proof that downtown is not dead, but its entry is only part of the solution. We need more.”

—  Scott Henry, founder, Celadon Partners

That is the trifecta La Salle Street Reimagined is targeting. The five projects already in the pipeline intend to turn office space into apartments or condominiums, adding at least 1,600 units. For example, the Prime Group’s proposal for renovating 208 South La Salle Street includes 280 apartments, along with a fitness center, to go with two existing hotels. Meanwhile, Celadon’s project will transform office space into 247 dwellings.

Most of those Celadon units — 75 percent — will be set aside for affordable housing, a fundamental objective of the La Salle Street makeover. The overarching plan calls for 30 percent of new residential units to be affordable to boost economic and social diversity downtown. In its 2022 request for La Salle Street proposals, the city specified that such units must be reserved for residents making no more than 60 percent of the metro area’s median income, which works out to a cap of about $66,000 for a family of four.

Adding affordable housing to mixed-use projects typically comes with a public financing sweetener to make sure the projects are financially sustainable for developers. The five La Salle Street Reimagined projects call for about $300 million in city-backed subsidies, primarily from tax increment financing, in addition to $870 million in private investment. “This is where the city’s role becomes important,” says Geoff Smith, executive director of the Institute for Housing Studies at DePaul University.

Mayor Johnson rattled La Salle Street backers by seeking to tap into a $434 million TIF surplus, including money from a designated La Salle Street TIF, to help fill a city budget hole. That’s why the 2024 budget does not include any La Salle Street funding. But Alderperson Bill Conway, whose 34th Ward includes the central business district, says he’s seen City Hall forecasts that show La Salle Street financing in 2025 and 2026.

That’s not soon enough for him. He wanted 2024 TIF funds allocated to the five projects and a rebuild of the corridor’s streetscape. “I worry that waffling on that commitment, or reneging, will make people hold back on investing downtown,” he says. Developers aren’t panicking just yet. Some chalk up the delay to a new mayor inundated with urgent matters such as the migrant crisis. “I think the new administration is getting settled,” says Michael Reschke Sr., founder of the Prime Group, which is also involved in the Thompson Center rehab and another La Salle Street corridor project at 111 West Monroe Street. “We’re just waiting for the green light.”

Could Johnson’s slow roll simply reflect a reluctance to give props to political rival Lightfoot? If so, Conway suggests an easy fix: “If he wants to call it the Brandon Johnson Reimagine La Salle Project, I’m all for it.”