Height: 2000 ft
Floor count: 120
Location: West Congress and South Canal
Neighborhood: Loop
Construction end:
Architect: Booth Hansen
Developer: International Property Developers

http://www.chicagorealestatedaily.com/apps/pbcsi.dll/storyimage/CG/20110721/CRED03/110729952/AR/AR-110729952.jpg&maxw=368&q=100


http://www.chicagotribune.com/business/breaking/chi-old-chicago-post-office-redevelopment-plan-unveiled-20110721,0,3150609.story

The owner of the Chicago's behemoth old post office building on Thursday unveiled a grandiose plan for redeveloping the long-vacant property and the area around it, including a 2,000-foot skyscraper that would dethrone the Willis Tower as the city's tallest building.

The owner, British developer Bill Davies, promises to transform the area into an "urban mecca" of five residential, office and hotel towers. Yet the three-phase project, which Davis wants to complete in 10 years, faces major economic hurdles, real estate experts said.

Completed in 1932, the post office building was once the world's largest post office. The building, which straddles the Congress Street feeder ramp leading to the Eisenhower Expressway, has been vacant since 1995. It has been the subject of several redevelopment plans, none of which have succeeded.

Davies bought the historic post office building in 2009 for $24.8 million, and is apparently convinced it has a future as something other than a white elephant.

"His concept is that it is not big enough," said Laurence Booth of the Chicago firm Booth Hansen, the designer of the project.

The first phase of the $3.5 billion project calls for converting the inside of the Old Post Office into retail shops and hotel rooms. The west side of the building will house a garage with ramps that would feed directly into Congress Parkway. The Beaux Arts-inspired marble and gold lobby will be restored to its original glory and would serve as the entrance to the shops and a 40-story hotel that would boast views of the Chicago River.

Davies plans to expand the project into three other sites: An empty lot south of West Harrison Street tucked between the Chicago River and South Wells Street; a lot south of Congress Parkway now home to a Holiday Inn and a parking lot; and the site adjacent to the Old Post Office known as the "Sugar House."

He has rights to buy the those properties but has not closed on the deals.

The plan, which was filed with the city on Thursday, is expected to be introduced to the City Council next week. It would then be reviewed by the housing and economic development staff. Typically, such a process can take months.

Once the plan is approved, the company can move with the $450 million first phase within 90 days, said Martin Mulryan, International Property Developers project manager.

Each phase would take three years each to be completed. The second phase, at a cost of about $2 billion, calls for a hotel in the current site of the Holiday Inn and adjacent parking lot, and a 120-story skyscraper at the site of the Sugar House to be used for office, hotel and residential space. The buildings will be raised over a 10 floor platform that would house more retail space.

The final phase calls for the development of the now empty site at the river. It will house 10 floors of retail space and a parking lot. Two 60-story residential towers will be built on top.

All sites will be connected with pedestrian bridges. To connect the site across the river, Davies plans to built a multi-story bridge with space for more retail shops and restaurants.

Peter Strazzabosco, a spokesman for the city's Department of Housing and Economic Development said the developers had met with city staff periodically over the last two years, but declined to comment on the plan or its political prospects.

Booth, the designer of the project, is a well-respected member of Chicago's often-contentious community of architects. But he has never completed anything of this scale.

Booth's finest projects, such as his award-winning renovation of Old St. Patrick's Church at 140 S. Desplaines St., have been considerably smaller. He has designed skyscrapers, however. His largest completed one to date is the 31-story Joffrey Tower at 151 N. State St., which combines retail space, condominiums and the Joffrey Ballet's offices and studios.

Booth also is no stranger to controversial skyscraper plans -- and to the difficulty in getting them built.

In 2007, along with developers James Klutznick and Tim Anderson, he unveiled his design for a 49-story, glass-sheathed condominium tower in north suburban Evanston. At 523 feet, it would have been the tallest building in Chicago's suburbs.

But many Evanston residents argued that the tower would be an over-scaled monstrosity and would uproot local merchants. In response, the plans were dramatically downscaled and in 2009, Evanston approved a downtown height limit of 35 stories.

The project has yet to break ground.

Davies, who has appeared on the Times of London's list of England's richest people, bought a dilapidated post office in 1986 in Liverpool, England and sold it 16 years later in the same condition, angering local politicians.

Gonzalez Hasbrouck Inc.
Chicago

Knock half of it down.

"The original building is a violation of the Burnham plan," says Joseph Gonzalez, principal. "It blocks the view corridor along Congress Parkway with this heavy-handed limestone building."

Removing the central core of the building restores the view corridor and makes DEVELOPMENT of the remaining structure more manageable, he says. The building could be developed into a combination of OFFICE and loft residential space.


I hate this proposal. Hmm well also, from what I can recall, it went against the Burnham plan to build all of those modern skyscrapers instead of everything Beaux Art mid-scale. Thus, we should tear down Sears Tower. Faulty reasoning.

I think one of the best aspects of the Old Post Office is its sheer bulk, and through this, its demonstration that there was a time in this country when developers and clients cared enough about craftsmanship that even unbelievably huge buildings on the scale of the Old Post Office could be done in an elegant, visually appealing way. Even the most utilitarian structures--warehousing and distribution for mail--were done with style. (Contra the NEW post office--and I"m not talking about the entrance / office building on Harrison which is nice, I'm talking about the riverside part, which is not going to sit well with the people who who live in the residential development that eventually gets built across the river.)

I don't see the disadvantage of the bulk of the building "blocking views." Blocking views of the expressway? Who cares.. And in the few times that I have driven in from the western suburbs, the approach to the post office was exhiliarating... Then, the fact that you go through this short tunnel as the expressway ends, and emerge on the other side downtown "triumpant." It adds to the experience.

The other negative about this submission is the design itself. People complain about the new Soldier Field merging old and new, but man this is much, much worse. Its like ripping out the center of the beloved Merchandise Mart and replacing it with curtain wall glass.. blasphemy! And that bridge across is utterly unspiring, and it looks stupid.

The main problem with this building, of course, is that it is so unbelievably huge, and so the demand for it is going to have to be of some incredible magnitidue for private development to work. Cutting the building into small pieces obviously solves that problem, but let's face it, that's a cop out--the easy way out. In that way, it violates the spirit, if not the law, of Burnham--"Make no small plans--they have no power to stir men's blood." (I'm sure that's a paraphrase but that's the best I can do.)

I like the designs that maintain the building as it is, enhancing its detailing, etc. Putting a casino in there seems like a great idea in some ways.. you could have a hotel above it, and build some new ramps and a parking garage within the building that would be accessible from Congress, and hence the expressways. You might also have to have a free trolley or bus that would go from North Michigan ave, etc. down to the casino, if was located here.

However, I still think the better location for the casino is along State Street at Block 37. They talk about retail at that site, but I find that problematic for several reasons (1) retail vacancies in the Loop are rather high as it is, and (2) frankly, we have enough retail downtown as a whole--all the major stores and then some, both discount, mid-priced, and upscale.. what else do we need? A casino on State street would provide a good way to further strengthen State Street, working towards the goal of making it as vital an urban destination as Boul Mich.

The other reason to build it there is that if the city can manage to pull off the plan for baggage check-in and high-speed rail to O'Hare, it could simultaneously turn a weakness of O'Hare into a strength.

Just think.. all of the thousands of travelers who get stuck at O'Hare in the winter for hours of delays and layovers, some of which are overnight. Few of them probably actually venture into the city, since they have little time, and its unbelievably cold, and they're from Phoenix or Atlanta or something so they can't deal with that. But hey--take a 25-minute shuttle, play a few games of blackjack and Texas Hold-em, and zip back to the airport for the next flight out. That's a layover well worth it.

Obviously I'm assuming that if you put the casino and the high speed rail on the Block 37 site, there would be an easy (and secure) way to travel between them without going outside. That would make it almost effortless for out-of-towners stuck overnight or for the day at the airport to burn off some steam and see the Chicago skyline on the train ride down there. There's plenty of room for both, plus condos and even a little bit of office space at block 37 since its such a big site. (Condos there should be immensely popular. If I was one of these consultants who has to travel back and forth from home every weekend, and I could basically live anywhere in the country, and I found there was a place to live that's in a nice urban setting yet also 25 minutes train ride from the airport without walking outside or negotiating traffic, that would be a huge pull. You would think they could market that kind of property to travelling businesspeople around the country. Same with office tenants. )

Plus, if the casino actually gets built elsewhere, I assume its going to be some boxy thing just barely "designed" by some ho-hum architecture firm that does big projects. If you have it at Block 37... Ralph Johnson, Lord Ralph, is your man.

http://***************************/random/postoffice03.gif

Hasbrouck Peterson Zimoch Sirirattumrong
Chicago

A large atrium — extending from the building's west to east side — would remove less than a third of the building while making the structure more inviting.

Solid glass atrium walls would give a feeling of translucency while allowing eastbound motorists to look through the building and into the city. Retailers could open out on the atrium. Upper floors of the main section and the towers would be residential. An enclosed veranda on the building's west side would be protected from the elements, air pollution and vehicular noise, but an atrium on the east side could be exposed and dedicated for use by building residents.

"The biggest impediment to it right now is it's rather forbidding," says James Peterson, a principal in the firm. "I don't think an adaptive reuse of the building just as it was would really work. It needed something stronger."


http://***************************/random/postoffice05.gif

Legat Architects
Waukegan

The perfect tenant for this firm's design idea is a casino.

"I was looking for one function that would give it a punch and, in doing so, not only support the other functions, but the city," says Vojo Narancic, head of design. "It would invigorate a whole part of the city that is sleepy."

A casino, shops, restaurants and entertainment venues would fill the lower portion of the central section, with a hotel and residences above that and in the towers. A large atrium would span the building's width in its center, and be augmented by red and yellow walls that would extend from ground level and through the roof. Pedestrian bridges on each floor would cross between the two sections. Colored laser lights could project the colors into the sky at night.

While keeping the building intact, Mr. Narancic suggests attaching floating glass panels to the building's east façade to give it a veiled yet more contemporary appearance. Glass membranes also would be attached to the top of the towers and extend upward to protect roof gardens.

http://***************************/random/postoffice06.gif

McClier
Chicago

The firm chose to preserve the existing façade, but convert the interior into five multitenant OFFICE buildings organized around four atriums.

"It really is a kind of building that on the exterior wants to be left alone," says Andrew Tobisch, vice-president of architecture at the firm. "There isn't any aspect of the building, down to the guard shack, that is not beautifully done, so we approached the building with great respect."

The bulk of the building would be dedicated to multitenant OFFICE space. McClier believes the building's location and large floor plates make residential or hotel DEVELOPMENT feasible. A commercial concourse spanning the length of the building's bottom floor would make the DEVELOPMENT a city within a city. A lack of green space in the neighborhood could be remedied by a landscaped roof, which could serve as a public plaza, complete with spectacular views of the city.

Personally, these would be my top three. I like the first of these the best in terms of doing actual changes to the building. I think it would be ridiculous to tear down the middle section as the very first proposal suggested. I agree with ChicagoLover that the sheer bulk of the building is its best aspects, that is why I also favor the third proposal in my list which suggests leaving the outside facade alone.

Chicago needs more color in its skyline I think. I would leave the building alone. Its the freeway I would talk about removing and putting some more blue line tracks down for extra long express trains. Think of different colors of neon lights all over the building. Like around each window or something, some thing really colorful.

I like the second idea foremost, followed by the first. I do agree that the structure is a bit squattish, although I like how the second idea deals with that.

A casino? In this building? Something in me died when I read that idea.

My idea is to demolish that building, and put a nicer more colorful skyscrpaper there, or something else nice like you just exited the rest of Chicago, and welcome to downtown feeling.

Make people go "wow, chicago knows how to make an entrance". Put a gate there...

im opposed to any changes to the structure... its grand, historic, and huge, and i love it like that. its like saying the merch mart is too big, lets cut a giant hole in it to make it look modern and cool. yeah, why dont we go back to a 1970's mindset while we are at it and modernise all those hideous limestone and terra cotta buildings with cor-ten steel and tile? ;)

Turn it into condos with retail on the interior. if you cant do it all at once, do it in phases... no need to gut and tear down half the structure...


"The original building is a violation of the Burnham plan," says Joseph Gonzalez, principal. "It blocks the view corridor along Congress Parkway with this heavy-handed limestone building."


and the Chicago Stock Exchange Building that is only a few blocks away dosent do that? Its an expressway, who cares about view corridors. It provides an effective way to tell drivers 'Slow Down! You're in the City Now!'

Hines' Role
Project Consultant

Location
Downtown Chicago bounded by Van Buren Street, Canal Street, Harrison Street and the south branch of the Chicago River

Net Rentable Area
Office:
2,000,000 square feet
(185,800 square meters)


Typical Floor Size
Office:
33,500 to 186,000 square feet
(3,112 to 17,279 square meters)

http://www.hines.com/propertyImages/old%20chicago%20po%204oct01.jpg

Hines has been engaged by the United States Postal Service to oversee the decommissioning of the building systems and to maintain the vacant facility. Concurrent with initial property management activities, Hines assembled a team of marketing consultants, architects and engineers in an effort to determine the redevelopment potential of the building and recommend to the Postal Service the building's highest and best use. The studies included an analysis of the building's potential adaptive re-use for office, entertainment retail, value retail, residential, hotel and parking functions. Hines also analyzed traffic studies, structural systems, environmental and landmark issues, and building operating systems. The United States Postal Service utilized the studies to package the project for disposition.

Sorry to revive an old thread, but it's going on two years now.

Is there any news?

Good call, i have been thinking more about the old post office lately. These are the latest results I got, its nothing recent to say the least...

http://chicagobusiness.com/cgi-bin/news.pl?id=16994&rel=1

July 01, 2005
By Alby Gallun


$300M revival plan for Post Office
A firm led by real estate mogul Neil G. Bluhm is in advanced talks with city officials over an estimated $300-million plan to turn the Old Main Post Office that straddles Congress Parkway downtown into offices, condos and a hotel.........


I really wish it could be considered for a massive intermodal transit center. Heck, with it being right by the Clinton Blue Line, instant Eisenhower access (could move the Greyound station too), on top of Metra/Amtrak south lines, etc. it would almost seem to be ready made. I am not sure how many tracks run under the PO though or if the number of tracks could somehow be expanded. But I did read an article once that said the city had looked into if it could serve as a high speed rail station for the future.

yeah this is a nice building as is,
just fix it up, rehab it,
into apts.

hopefully they dont disfigure it.

^Maybe residential/hotel/office for part of it, but there are a lot of creative ideas that could work. Reminds me a bit of all the power station redevelopment projects in London:

Oxo Tower - nice restaurant on top too
http://img116.imageshack.us/img116/6249/20557754d858cc3d33bx6.jpg

Bankside Power Station - Tate Modern
http://img104.imageshack.us/img104/7041/800pxtatemodernlondon20ay8.jpg

And now Battersea Power Station
http://img292.imageshack.us/img292/7375/3358316613f13fad547oe8.jpg
http://img292.imageshack.us/img292/3403/aerial20view20from20thevm0.jpg

just fix it up, rehab it, into apts.

Too little windowline for the floorplates. And the SHPO told them they couldn't hang balconies on it.

The Tate Modern is definitely one of my favourite "old is new again" buildings. I just love it. And those slides they have there at the moment are great fun. lol

Seriously though, I hope they do something cool with the old post office. The "new" one is so freakin' hideous and mismanaged though.

..

http://chicagobusiness.com/cgi-bin/mag/article.pl?article_id=27395&bt=office&arc=n&searchType=

At Deadline

A step forward for old Post Office redo

The long-awaited revamp of the old Main Post Office downtown has moved a step closer to reality. A proposal to convert the 2.5-million-square-foot building into 300 residential units, 240 hotel rooms and 455,000 square feet of office space is scheduled for consideration at the April 19 Chicago Plan Commission meeting. Chicago real estate investor Walton Street Capital has been working for more than eight years on the plan. "There are so many government entities that have an interest," says Walton exec Raphael Dawson. "Everyone from the (Army) Corps of Engineers to IDOT has something to say about this." [Alby Gallun]

April 19 Plan Commission Agenda

A proposed Waterway Business Residential Planned Development Application submitted
by Chicago P.O. Associates, LLC for the property generally located at 401-439 West Van
Buren Street. The application allows for the construction of 300 residential units, 240 hotel
keys, approximately 455,000 square feet of office space and 400 parking spaces. This
building is identified as potentially significant in the Chicago Historic Resources Survey.
(2nd Ward)

Okay, so, now that some of the beans have been spilled - I'll try to do my best to fill in some information (as much as I can without getting fired).

I've been working on this project for a couple of weeks and here's what we know so far: the current scheme involves hotel, office, residential and retail components. The old loading areas and some of the mail handling areas on the lower floors will be used for parking; half of the building that spans Congress (between the four corner towers) is going to be removed with the hotel component filling the remainder. That's about all I can comfortably say for now - I'll keep updating as it seems appropriate to do so.

^Cool.

Does it still look like this?:

http://img359.imageshack.us/img359/5784/3cd78e020eb8429c923c5f8yj0.jpg
http://img359.imageshack.us/img359/7245/ba27c95dde854e098f71f14yz7.jpg

Okay, so, now that some of the beans have been spilled - I'll try to do my best to fill in some information (as much as I can without getting fired).

I've been working on this project for a couple of weeks and here's what we know so far: the current scheme involves hotel, office, residential and retail components. The old loading areas and some of the mail handling areas on the lower floors will be used for parking; half of the building that spans Congress (between the four corner towers) is going to be removed with the hotel component filling the remainder. That's about all I can comfortably say for now - I'll keep updating as it seems appropriate to do so.

Wow, that's pretty exciting stuff....this development could have an ENORMOUS impact!

^^^^^^
Not to mention that this particular corner of the Loop could use some spiffing up.

^^^^^^
Not to mention that this particular corner of the Loop could use some spiffing up.

Speaking of this particular corner of the Loop, does anyone have any idea of what the status is for Wacker Plaza? (on the SE corner of Wacker and Van Buren)

spyguy - the massing looks to be pretty much the same in terms of what's going to be removed and what's going to stay - but, other than that, alot has changed.

Speaking of this particular corner of the Loop, does anyone have any idea of what the status is for Wacker Plaza? (on the SE corner of Wacker and Van Buren)

The same as the status for every other moderately-sized office project in the West Loop - it needs tenants. Once it gets some, you can bet they'll start construction within 3 or 4 months.

Right now, there's not too much of an active demand for office space in the Loop. Yes, brand-new Class A office space does sell, but many times, they are filling with companies simply moving out of older buildings.

spyguy - the massing looks to be pretty much the same in terms of what's going to be removed and what's going to stay - but, other than that, alot has changed.


800,000 square feet of building space will be removed and they're going for LEED certification. The greatest impact will be fom the west. Visually, driving east on the IKE will never be the same.

800,000 square feet of building space will be removed and they're going for LEED certification. The greatest impact will be fom the west. Visually, driving east on the IKE will never be the same.
I'm surprised to learn that such a huge chunk can be removed from a landmarked Art Deco structure.

It's amazing what can happen to a huge downtown building after it's been vacant FOR 11 YEARS.

http://www.chicagotribune.com/news/local/chi-070418post-officeapr18,1,3341344.story?coll=chi-news-hed

Plan for huge former post office considered

By Alexa Aguilar
Tribune staff reporter
Published April 18, 2007, 9:22 PM CDT

The old Chicago Post Office, a behemoth that spans the Eisenhower Expressway and two city blocks, is so large that developers have struggled for almost a decade to come up with a workable plan for the vacant space.

On Thursday, 11 years after the U.S. Postal Service moved its operations to a newer facility nearby, the city's Plan Commission will consider a proposal to convert the building's 2.5 million square feet of empty space to a sprawling project of hotel rooms, offices and residences. Previously, different developers have proposed creating a mausoleum, a casino, an auto mall and a water park in the Art Deco-style building.

The latest renovation plan, supported by city officials, includes removing more than a million square feet from the building's center to create a north tower for office space, a south tower for residences, a 240-room hotel facing the Chicago River, 400 parking spaces and a green rooftop terrace.

Walton Street Capital LLC, the real estate investment firm that came up with the proposal, has pitched idea after idea to prospective tenants and hoteliers over the years. The firm first indicated its interest in the space to the Postal Service in 1998.

But the building's size, its historic designation and its proximity to nearby railroad tracks and the expressway have stalled the project repeatedly.

"It's a fascinating project, if we can pull it off," said Raphael Dawson, a partner at Walton Street.

The city will likely kick in subsidies, in the form of a tax-increment-financing grant, for Walton Street, said Constance Buscemi, a spokeswoman for the city's Planning Department. She declined to provide specific numbers.

"We've been working with them on this for quite some time," Buscemi said.

The plan takes a "grand, old building" and gives it a new purpose, she said.

The 10-story building, once the world's largest post offices, is on the National Register of Historic Places. First built in 1921 and then transformed with a dramatic expansion in 1932, the building was designed by Graham Anderson Probst & White, the same firm that designed such Chicago landmarks as the Civic Opera House and the Merchandise Mart.

Because of that designation, the proposal needed the approval of the National Park Service, which oversees properties on the national register. Dawson said the park service has given its approval.

David Bahlman, president of Landmarks Illinois, a statewide preservation organization, said he is disappointed there isn't a plan that could save the entire building. The old post office has been on the group's list of most endangered landmarks, he said.

But he acknowledged that the structure's size and location made redevelopment difficult.

"This is a tough, tough project . . . one of the most difficult preservation issues I have ever seen," he said. "It's the poster child for what we call white elephants."

The stalled project garnered the attention of a U.S. Senate subcommittee last year, when Sen. Tom Coburn (R-Okla.) used the old Chicago Post Office as an example of surplus federal property that used taxpayers' dollars to maintain vacant space.

It cost the federal government $2 million a year to maintain the building, he said last year.

aaguilar@tribune.com



Copyright © 2007, Chicago Tribune

2 MILLION? to do what?!? I thought the whole thing was vacant and surrounded by a chain-link fence.

2 MILLION? to do what?!? I thought the whole thing was vacant and surrounded by a chain-link fence.

This is a HUGE buillding! Just because a building is vacant, doesn't mean it costs nothing to maintain. They have to pay for security to ensure the building remains sealed. they probably have to maintain a minimum temp (above freezing) in the winter to prevent structural damage. They have to ensure the roof isn't leaking, because that can contribute very quickly to deterioration. They have to maintain mechanical systems, even if they aren't used. I could go on and on...

Is it safe to assume that this was approved by the plan commission today?

Have you ever heard of Plan Commission not approving anything brought before it?

http://www.chicagotribune.com/news/local/chi-070418post-officeapr18,1,3341344.story?coll=chi-news-hed

Plan for huge former post office approved

By Alexa Aguilar
Tribune staff reporter
Published April 19, 2007, 5:56 PM CDT

The Chicago Plan Commission today approved a plan to transform the old Central Post Office, a hulking downtown building that looms overhead as drivers zoom through it on the Eisenhower Expressway, into towers of offices, residences and a hotel.

The historic Art Deco building spans two city blocks. It has sat vacant since 1996, when the U.S. Postal Service moved operations to a newer building nearby. Developers were stumped by its bulk, proximity to railroad tracks, the Chicago River and the expressway, and its historic attributes.

The renovation proposal sent today to the City Council for final action would remove 800,000 square feet from the center of the 2.5 million-square-foot building, build a deck and plaza overlooking the Chicago River and preserve the building's soaring lobby and vestibule.

With a big chunk carved out of its center, the renovated property would have a north tower for office space, a south tower for residences, a 240-room hotel facing the Chicago River, 400 parking spaces and a green rooftop terrace.

Walton Street Capital LLC, the real estate investment firm that came up with the current proposal, has pitched idea after idea to prospective tenants and hoteliers over the years. The firm first indicated its interest in the space to the Postal Service in 1998.

"It's a fascinating project, if we can pull it off," said Raphael Dawson, a partner at Walton Street.

The city will likely kick in subsidies, in the form of a tax-increment-financing grant, for Walton Street, said Constance Buscemi, a spokeswoman for the city's Planning Department. She declined to provide specific numbers.

"We've been working with them on this for quite some time," Buscemi said.

The plan takes a "grand, old building" and gives it a new purpose, she said.

The 10-story building, once the world's largest post office, was built in 1921 and transformed in a dramatic expansion in 1932. It was designed by Graham Anderson Probst & White, the same firm that designed such Chicago landmarks as the Civic Opera House and the Merchandise Mart.

David Bahlman, president of Landmarks Illinois, a statewide preservation organization, said he is disappointed there isn't a plan that could save the entire building. The old post office has been on the group's list of most endangered landmarks, he said.

But he acknowledged that the structure's size and location made redevelopment difficult.

"This is a tough, tough project . . . one of the most difficult preservation issues I have ever seen," he said. "It's the poster child for what we call white elephants."

The stalled project garnered the attention of a U.S. Senate subcommittee last year, when Sen. Tom Coburn (R-Okla.) used the old Chicago Post Office as an example of surplus federal property that used taxpayers' dollars to maintain vacant space.

It cost the federal government $2 million a year to maintain the building, he said last year.

aaguilar@tribune.com



Copyright © 2007, Chicago Tribune

can one assume that the lack of pictures and details indicate this is still a very loose concept sorely lacking in detail at this point?

I heard that the "Gotham National Bank" recently moved into part of the Old Post Office. Watch out though, because apparently the Joker and his goons have been wreaking havoc down there...

can one assume that the lack of pictures and details indicate this is still a very loose concept sorely lacking in detail at this point?

Current:
http://static.flickr.com/44/119984337_d9f9c35b74_o.jpg

Proposed
http://www.glenstarproperties.com/images/pic_bldg_po1.gif

Based on the southloop buildings this looks about a year old. Gives you a great perspective on how huge the roof deck could be. They would have there own park
http://i97.photobucket.com/albums/l221/Mansmith_2006/chicago_PostOffice.jpg

I heard that the "Gotham National Bank" recently moved into part of the Old Post Office. Watch out though, because apparently the Joker and his goons have been wreaking havoc down there...

Holy, Expressway Overlap!:lol:

a picture is worth a thousand words...thanks, Hydrogen

Holy, Expressway Overlap!:lol:

Seriously, though...for the past few days they've been shooting some preliminary stuff for the next Batman movie down there at the Old Post Office, which has been "redressed" as the Gotham National Bank.

^Yeah, it's fun to watch, although there aren't any "stars" as far as I can tell.

The concept is not loose. It's been in production for seven years and is ready to rock and roll as far as I know. There are pleanty of renderings - they just haven't been loosed :)

Does it still look like this?:
Kind of sort of, but, not really. The base hasn't changed much but, above, there is ALOT more glass now.

So why couldn't they leave the east and west walls intact, but put a cool garden atop the parking garage in between the north and south towers? People inside the towers would have windows and a view, but the building's historic envelope would survive intact.

Posted: Tuesday, 24 April 2007 12:12PM

Fire Reported At Old Chicago Post Office

CHICAGO (WBBM) -- A rubbish fire ignited at the old Chicago Post Office building Tuesday afternoon where the new Batman movie is currently being filmed.

WBBM’s Bernie Tafoya reports from the scene.

A rubbish fire ignited on the top floor of the old Post Office, 300 S. Riverside Plaza, according to Larry Langford, a spokesman for the Chicago Fire Department.

The new Batman movie is currently being filmed in the building and filmmakers did not start this fire as a part of the movie, Langford said.

"This fire is not a fake," Langford said.

Langford said the fire is not out of control and that no injuries have been reported. The latest reports indicate that the fire has been struck out.

"We were trying to account for all of the Batman personnel," Langford said.

A source tells CBS 2, Newsradio 780's sister station, fan on the roof may have contributed to the fire by igniting some garbage.

Newstipper Tony Smaniotto, who works at 311 South Wacker and has been watching them shoot the movie and tells Newsradio 780 that the Post Office fire is separate and real.

"Smoke started bellowing out of the northwest corner of the building and every fire truck in the city is over there," Smaniotto said.

The old Post Office has been vacant since 1996, when the Postal Service moved into a newer nearby building. Plans are afoot to turn it into a hotel and residential building.

I was walking down there on South Canal on Saturday.. pretty cool stuff.

http://superherohype.com/gallery/Batman/The_Dark_Knight/The_Movie/On_Set/dennis4.jpg
Got the image off of Google (Superhero Hype)

So why couldn't they leave the east and west walls intact, but put a cool garden atop the parking garage in between the north and south towers? People inside the towers would have windows and a view, but the building's historic envelope would survive intact.
And how do you propose that those walls be supported? I question whether or not that would be a great space anyway - I mean, you'd be inside a park surrounded by massive walls. There are instances where that could be very cool, but, there are also times when it could be a prison-yard-like condition. I'm just not sure I see the point.

And how do you propose that those walls be supported? I question whether or not that would be a great space anyway - I mean, you'd be inside a park surrounded by massive walls. There are instances where that could be very cool, but, there are also times when it could be a prison-yard-like condition. I'm just not sure I see the point.

Isn't that what the architect is hired to do? ;) Take the need of the client and design the product? Couldn't a system be designed that would support the walls and leave the top mostly open? I like Mr. Downtown's idea in that it gives a nice view for the towers, is environmentally friendly, and preserves a historically sensitive landmark.

Can you imagine the effect on the southwest Loop area if the Post Office actually goes ahead with the redevelopment and that the tower portion is added to Union Station? Can you imagine how exciting the "grand entrance" through the Eisenhower to downtown would become?

And how do you propose that those walls be supported?

Um, the same way they are now. It's pretty common to cut away the center of floor slabs in standard mushroom-cap concrete loft buildings. I presume you'd leave a perimeter 14 feet deep to the first set of columns. For that matter, why not do a 28-foot depth and sell units in the east and west walls?

I question whether or not that would be a great space anyway - I mean, you'd be inside a park surrounded by massive walls.

In Chicago's climate it might be better to do it as a winter garden. Imagine both hotel and condos facing a massive winter garden with a pool, Canary Island palms inside and a running track encircling it. If you're not trying to keep it at 72 degrees, you could probably do it with a Teflon-coated nylon roof (like Skyline Stage at Navy Pier, or Potsdamer Platz) so you wouldn't have the expense of doing a new glass roof.

I'm just not sure I see the point.
To keep the massing of the Old Post Office so that entering downtown continues to be like coming through a gate in a massive old city wall, instead of like passing under a tollway oasis.

^^ I'm generally with Geoff on this one, but that tollway comparison is hilarious :lol:

I really like Mr. Downtown's Idea. I too was picturing a winter garden atrium type area like at Navy Pier. Driving under it yesterday evening, it seems wide enough to make it not feel like a prison. What a beer garden it could make in the wintertime - you can watch the cars from the Eisenhower go under you! I hate to see the building that wowed me so much as a child be destroyed to turn a better profit for a developer.

Well, if you're talking about making the perimeter of the entire center section of the building into a single-loaded residential building, that's a bit of a different story. Unfortunately, now you're talking about 40 feet of depth on each side of the building - leaving, something like 80 to 100 feet between the two "newly created" buildings. I still have to question the demand for a winter-garden in a residential building. It would be a huge operating expense that just isn't likely to create the returns needed to sustain it.

- edit

Wow...that's a lot of money to ask the city to contribute. I kinda wish I liked the design more.

Hmmmm...not too sure about this one.

I hate to see the building that wowed me so much as a child be destroyed to turn a better profit for a developer.Yeah, I hear ya PRB. Like you, I still have fond childhood memories of our family's weekly drive downtown to attend the Sunday Service at the world's tallest church, the Chicago Temple.

You knew you were approaching the city when the upcoming highway seemed to mysteriously disappear into the darkness of overpowering and towering concrete curtains...
We'd follow the highway into the darkness, through the concrete curtains -- when, out of nowhere, those curtains would suddenly open up to reveal the grandest stage of all, complete with a full cast of blue- and white-collar characters living out a real-life story of hardcore hustle and bustle in a big, brawny City that was legendary for its Broad Shoulders.

Would hate to imagine future generations being deprived of that experience for a lame new landmark known as "MrDowntown's Toll-booth Oasis."

But, who knows? Maybe we'll be pleasantly surprised. Chicago has been blessed with so many incredible projects these last few years. There's really been nothing to complain about, it's crazy.

$51 million for a mediocre redevelopment plan? No thanks.

I understant is a huge undertaking but 51 million for a mediocre non-descript rehab sounds like a lot.

I cannot believe the post office is getting $10 for the building and then turning around to do remediation for $9M. $51M for 300 condos, 540,000 SF of office, and 256 hotel rooms? How can they possible make that back? Even JUST for the condos (assume average unit $400,000, 2.5% taxes, the city AND the county SHARE $3,000,000 annually).

And do we really NEED more hotel rooms and office space?

I find it hard to believe a developer can't take a free building completely mitigated for environmental issues considered to be historically sensitive and have difficulty trying to turn a profit.

I am very reluctant to get excited about this project. If they preserved the building in its existing form, it would be one thing, but they really can't play the preservation card.

OT... would a developer such as this one get audited for the construction costs to collect the TIF monies?

I cannot believe the post office is getting $10 for the building and then turning around to do remediation for $9M. $51M for 300 condos, 540,000 SF of office, and 256 hotel rooms? How can they possible make that back? Even JUST for the condos (assume average unit $400,000, 2.5% taxes, the city AND the county SHARE $3,000,000 annually).
TIF dollars aren't intended for the City to turn a profit. They're to spur development where it's needed. In the end, that usually turns into tax dollars. Even in your scenario, they're making money after twenty years... how is that a bad deal?

Oh, and that doesn't even count the taxes being paid on the retail or office space. Oh, and then there's the hotel taxes.

TIF dollars aren't intended for the City to turn a profit. They're to spur development where it's needed. In the end, that usually turns into tax dollars. Even in your scenario, they're making money after twenty years... how is that a bad deal?

Oh, and that doesn't even count the taxes being paid on the retail or office space. Oh, and then there's the hotel taxes.

This is all true, but the city can receive these tax revenues from mixed-use developments that they don't give $51 million to. How is this project going to change overall demand for condos, hotels, office space, and retail, in the city? If the post office wasn't renovated, the people who would have bought condos there, moved their offices there, etc., simply would buy lease/somewhere else and would pay taxes on those condos, retail space, etc. So while the post office will bring in tax revenues, it would be taking away tax revenues from other locations in the city. Essentially, the overall tax revenues that the city receives should not be changed as a result of this project.

Almost all other developments bring in tax revenues too, but don't need to use up the TIF money. That $51 million would have been MUCH better spent on improving the el....that would actually have a large, positive impact on the majority of Chicagoans.....and unlike this project, would create a NET positive increase in tax revenues as a much-improved public transportation system will increase the desirability to live and visit Chicago, spurring more business and more tax revenues from the new residents and tourists.

TIF dollars aren't intended for the City to turn a profit. They're to spur development where it's needed. In the end, that usually turns into tax dollars. Even in your scenario, they're making money after twenty years... how is that a bad deal?

Oh, and that doesn't even count the taxes being paid on the retail or office space. Oh, and then there's the hotel taxes.


The economics of a TIF fund is to break even. Redeveloping the post office will not spur much development around that immediate area. It is certainly not needed. In fact, an arguement could be made that with the increase of supply in this area, the demand is lowered, and therefore property taxes are decreased slightly.

I do not think you can repay a TIF fund with hotel taxes.

Plus, people will be moving to the neighborhood and instead of paying property taxes at a non-TIF development, their taxes will be repaying the debt instead of going to schools, park districts, or the County (the board of education is estimated to get 49% of property taxes in Chicago and therefore losing $25M in the life span of the TIF). I suppose the only good thing about this is the developer will have to provide 20% of his units as "affordable" and that we are saving the post office money (although they are shelling out $9M to help with environmental mitigation).

I really hope the city council thinks this through.

The economics of a TIF fund is to break even. Redeveloping the post office will not spur much development around that immediate area. It is certainly not needed. In fact, an arguement could be made that with the increase of supply in this area, the demand is lowered, and therefore property taxes are decreased slightly.

I do not think you can repay a TIF fund with hotel taxes.

This is falsely applied economics. "Break-even"? Over what time frame, perpetuity? The point of TIF is to spur development. The city kicks in dollars to make a proposed development feasible at the project level. "Supply"? Supply of what product? Besides, as you allude supply and demand meet at equilibrium, and hence the market is happy.

Chicago is better off with a quality development at the Post Office, as opposed to it sitting vacant to my mind. A reputable sponsor in Walton Street is a major endorsement in terms of the quality of the plan.

I think the point you may be trying to make is that $51 million does not grow trees. I agree; it is huge amount of money and the city should take it seriously. Only problem is, a deal at the Post Office isn't geting any cheaper over time. It is going to take a big investment to get something done at that site.

Guys, I was pointed out whole articles of third party web sites are being copied in full in this thread. Please refrain from doing that. The proper way to point things out is:

source: SkyscraperCity.com (http://www.skyscrapercity.com)

title: Lorem ipsum dolor sit amet
First paragraph or abbreviation. Lorem ipsum dolor sit amet, consectetuer adipiscing elit. Integer consequat sapien a lectus gravida euismod. Sed vitae nisl non odio viverra accumsan. Curabitur nisi neque, egestas sed, vulputate sit amet, luctus vitae, dolor. Cras lacus massa, sagittis ut, volutpat consequat, interdum a, nulla. Vivamus rhoncus molestie nulla. Ut porttitor turpis sit amet turpis. Nam suscipit, justo quis ullamcorper sagittis, mauris diam dictum elit, suscipit blandit ligula ante sit amet mauris. Integer id arcu. Aenean scelerisque. Sed a purus. Pellentesque nec nisl eget metus varius tempor. Curabitur tincidunt iaculis lectus. Aliquam molestie velit id urna. Suspendisse in ante ac nunc commodo placerat.

» continue reading (http://www.skyscrapercity.com/showthread.php?t=179804&page=3)

This is falsely applied economics. "Break-even"? Over what time frame, perpetuity? The point of TIF is to spur development. The city kicks in dollars to make a proposed development feasible at the project level. "Supply"? Supply of what product? Besides, as you allude supply and demand meet at equilibrium, and hence the market is happy.

Chicago is better off with a quality development at the Post Office, as opposed to it sitting vacant to my mind. A reputable sponsor in Walton Street is a major endorsement in terms of the quality of the plan.

I think the point you may be trying to make is that $51 million does not grow trees. I agree; it is huge amount of money and the city should take it seriously. Only problem is, a deal at the Post Office isn't geting any cheaper over time. It is going to take a big investment to get something done at that site.

I think that most people are aware that a major purpose of TIF is to spur development. But what I would like to see is argument from people as to why they think that this will spur development. Obviously, if this project goes through, you'll have a few hundred more condos and hotel rooms and some more office space created. But is this development organically creating new and increased demand for condos, hotel rooms, and office space? Or would the development of this project simply take it's demand away from other proposed projects....and thus cause a proposed condo, hotel, and/or office project to not get built, which would have been built if it weren't for the post office development adding to the surplus of supply of condos, hotel rooms, and office space?

I currently don't see any major reasons why the former would be true, but perhaps there are actual ways that this development would spur organic growth that I am just not aware of. Perhaps this development will spur more development nearby, in the area just southwest of the loop? Or it has some other hidden benefit to it? Those that are in support of providing $51 million of TIF funds to this project - I'm curious to hear what you think the possible long-term benefits of this project would be.

This is falsely applied economics. "Break-even"? Over what time frame, perpetuity? The point of TIF is to spur development. The city kicks in dollars to make a proposed development feasible at the project level. "Supply"? Supply of what product? Besides, as you allude supply and demand meet at equilibrium, and hence the market is happy.

Chicago is better off with a quality development at the Post Office, as opposed to it sitting vacant to my mind. A reputable sponsor in Walton Street is a major endorsement in terms of the quality of the plan.


The point of a TIF is to break-even, or recapture the funds from property taxes that otherwise would not have been received. The money just doesn't come out of Daley's bank account. A separate fund is set up and repaid over the period of the predetermined TIF length (23 years I believe). I don't doubt that this TIF can break even, but at the expense that over the next 23 years, the property taxes generated by this development will 100% directly be paying off the TIF amount. None of the taxes will go towards schools, fire, the city, county, park district, etc. I don't agree that the area around this development is blighted, which basically is the law for using TIF funds. This is a textbook example of how Daley's administration have abused TIFs. The question is... will this be set up as its own TIF district or will it be annexed into an existing district?

I think this development will improve the look of the post office, even though it is altering its structure that ultimately will give it a different look as opposed to preserving the structure.

A few projects within the nearby South Loop have been tabled lately (D2, Lennar), presumably due to the slowing market and the abundance of units currently under construction in the area. I think adding the condos, if anything, will adversely effect property values by adding to the abundant supply of homes. I really feel that the city does not necessarily need more office space. There is plenty of vacant office space in the central business district and getting new tenants will most likely be robbing Peter to pay Paul.

Also, TIFs should benefit the entire neighborhood. The only thing we get is to see a cleaned up building.

I feel like they are rushing into this project (to bail out the post office?) and basically giving the developer a $51M loan that the people he sells the product to will have to repay with their property taxes at the expense of the rest of the residents of the city who are paying taxes to legitimate causes. While the building has been sitting vacant for years, I feel like they need to go back to the drawing boards to come up with a better solution (both preserving the existing look and avoiding how to ask the city for $51M and the post office for $9M). I also find it hard to believe that over the next 23 years, a developer can't figure out how to develop the property profitably that ultimately would net good tax flow into the neighborhood.

I fear that this project will set a precedent that the city will bail out developers trying to redevelop older buildings.

On the other hand, the Post Office is the size of a small neighborhood. This one project alone will add pedestrians to the streets around here, and will allow much-needed sidewalk and retail improvements. The point here isn't to spur development (that's a crap shoot anyway); the post office project facilitates development. Right now, the vacant hulk DETERS development in the area.

A few projects within the nearby South Loop have been tabled lately (D2, Lennar), presumably due to the slowing market and the abundance of units currently under construction in the area. I think adding the condos, if anything, will adversely effect property values by adding to the abundant supply of homes. I really feel that the city does not necessarily need more office space. There is plenty of vacant office space in the central business district and getting new tenants will most likely be robbing Peter to pay Paul.

Residential is slowing down, which may be why those residential developments have been tabled. The 2 projects you mention also could have been halted for a thousand other reasons.

Institutional developers and investors largely are not concerned about absorption in Chicago. Market fundamentals are strong; the glut story does not hold.

Also, TIFs should benefit the entire neighborhood. The only thing we get is to see a cleaned up building.

That is what we get in the deal; I think you should judge it on those merits. Most people would agree it's a big cost.

I feel like they are rushing into this project (to bail out the post office?) and basically giving the developer a $51M loan that the people he sells the product to will have to repay with their property taxes at the expense of the rest of the residents of the city who are paying taxes to legitimate causes. While the building has been sitting vacant for years, I feel like they need to go back to the drawing boards to come up with a better solution (both preserving the existing look and avoiding how to ask the city for $51M and the post office for $9M). I also find it hard to believe that over the next 23 years, a developer can't figure out how to develop the property profitably that ultimately would net good tax flow into the neighborhood.

Time is costly in these instances. Us sitting from afar it is hard to say, but the simple fact that this building has sat vacant for so long should tell you how challenging it is for redevelopment.

If I am not mistaken, the USPS doesn't pay the millions in upkeep every year, our tax dollars do (ironically).

Residential is slowing down, which may be why those residential developments have been tabled.

That is what we get in the deal; I think you should judge it on those merits. Most people would agree it's a big cost.


I think everyone agrees that residential is slowing down, but by adding the units, would you not agree that the extra supply would have an adverse effect on adjacent properties that are about to go on the market, and therefore would theoretically decrease the amount of property taxes?

By making the building easier on the eyes being the sole tangible advantage to the neighborhood, I fear that this sets a huge precedent for TIFs.

I understand your points, I just am having a hard time swallowing the justification for this large amount of TIF funds.

the USPS doesn't pay the millions in upkeep every year, our tax dollars do (ironically).

Why would tax dollars be used for a USPS facility?

Why would tax dollars be used for a USPS facility?

As I understand it, the building is not owned by the USPS. The city maintains the building, and taxes maintain the city.

From the Chicago Tribune:

"The stalled project garnered the attention of a U.S. Senate subcommittee last year, when Sen. Tom Coburn (R-Okla.) used the old Chicago Post Office as an example of surplus federal property that used taxpayers' dollars to maintain vacant space.

It cost the federal government $2 million a year to maintain the building, he said last year."

Source: http://www.chicagotribune.com/news/local/chi-070418post-officeapr18,1,3341344.story?coll=chi-news-hed

Does anyone know if by using TIF funds, does the developer need to disclose the construction costs of the project or allow an audit to show that he isn't blowing smoke up everyone's ass with the $310M construction price (nearly $200/SF)?

Doing quick math:
1,700,000 SF x $300/SF = $510M

But to be more conservative:

300 Condos @ $300,000 each = $90M
455,000 SF office @ $200/SF = $90M
400 parking stalls @ $40,000 each = $16M
240 hotel rooms @ $200,000 each = $48M
Total = $244M
Note that these unit prices are very conservative (in my opinion).

I don't doubt they will need the $51M to break even IF it truly costs $310 million to renovate.

http://www.chicagoreader.com/features/stories/theworks/070525/

A TIF That Might Make Sense

The city’s plan for the old main post office

By Ben Joravsky
May 25, 2007

ON THE SURFACE, the city’s recent proposal to give a real estate consortium roughly $51 million to develop the old central post office looks like another unwarranted handout to the rich and well connected. But in fact this is one of the few tax increment financing deals that actually makes some sense—which just goes to show you how demented the program has become.

Vacant since 1996, when the post office moved its distribution center, the 17-story, 2.5-million-square-foot limestone edifice just west of the Loop sits on the bank of the Chicago River with the Eisenhower Expressway shooting through its belly. The city thought it had a deal for the building in 1999, when a group of developers planned to convert the 1932 art deco structure into a hotel, loft condos, and offices. But that fell through when the economy weakened after 9/11.

Since then, other proposals have come and gone, but no one seems to know what to do with the property. The city can’t demolish it without enraging preservationists (not that this would necessarily stand in its way). And no public institution has been willing to take over the mammoth building, which covers two city blocks.

So on May 8 the Community Development Commission, the body that oversees TIFs, recommended that the city fund a new but similar plan, giving Walton Street Capital LLC $51 million in property tax dollars to convert the old post office into office space, a luxury hotel, and condos. The proposal now moves to the City Council, where approval is expected.

For Walton, headed by real estate mogul Neil G. Bluhm, the deal’s a no-brainer. The federal postal service is selling the property for ten dollars and kicking in another $9 million to yank out the asbestos. The city’s $51 million will cover about 17 percent of total construction costs, including the demolition of 800,000 square feet Walton has no use for.

Normally I’d be howling about the diversion of taxes to developers to build a bunch of condos—as if Chicago needs any more of those. But in this case it’s not so much a diversion as a conversion: the federally owned post office pays no property taxes to begin with. If the handout enables Walton to put formerly tax-exempt land on the property tax rolls, it’s a gain for the public.

Trouble is, property taxes from the new hotel and condos won’t be going to the schools and parks but to the Canal-Congress TIF, adding millions to one of Mayor Daley’s forever-expanding slush funds for years to come. I wouldn’t be so concerned if park or school district officials were at the bargaining table demanding that property taxes generated by the post office development be sent their way as soon as the city’s subsidy is recouped. But as they usually do with TIF deals, school and park officials are passively going along with the project for fear of upsetting Mayor Daley.

Surprisingly, the CDC, usually a docile bunch, showed some scrappiness at the hearing a few weeks back. Commissioner Rafael Leon asked why Walton was only setting aside 15 of 300 units for affordable housing, a number far below the city’s 20 percent set-aside requirement on TIF-funded deals. Raphael Dawson, a Walton principal, said that’s all the company could afford to build. Then a city planner reminded Leon that the developers were also contributing $4.5 million to the city’s low-income housing fund. That donation puts the firm in compliance with even the new, supposedly tougher set-aside ordinance passed by the City Council less than a week later.

Another commissioner, Anne Kostiner, raised the touchy subject of the infamous Block 37 deal. In the 1980s the city spent about $40 million buying up all the property on the block bounded by Randolph and Washington and State and Dearborn. It then paid to demolish the existing buildings and sold the land to FJV Venture, a development firm led by Bluhm and Judd Malkin, for about $12.6 million. FJV couldn’t put a deal together, so in 2001 the city bought the land back for $32.5 million. All in all, the city managed to lose roughly $60 million on the transactions.

As Kostiner pointed out, there’s no guarantee that Walton’s post office project will be a winner either. The downtown condo market’s soft, and Walton still hasn’t lined up all of its conventional financing. Noting Bluhm’s involvement in the Block 37 deal, Kostiner asked the developers what assurances they could offer that the city wouldn’t wind up on the hook once again.

Good question. After a moment of awkward silence Dawson said he didn’t know anything about Block 37 but was confident this deal would work.

I hope he’s right. With property taxes looking to go sky high in August after this year’s reassessments, the last thing taxpayers need is to throw away millions of dollars on a real estate deal gone bust.

City officials didn’t seem too concerned by this prospect, and I can understand why. Since the electorate never holds Mayor Daley accountable for anything he or his administration does, why not swing for the fences?

Talk about your axe grinders. His not so subtle hatred of Chicago's mayor has reduced "argument" to little more than enthymematic rant.

I know we used to have a dedicated thread for the OPO but couldn't find it.


http://www.chicagotribune.com/business/chi-old-chicago-post-office-40-million-aug27,0,6687261.story

Old Chicago post office sold for $40 million

By Mary Ellen Podmolik

Tribune staff reporter

2:34 p.m. CDT, August 27, 2009

The old Chicago post office at 433 W. Van Buren St. sold Thursday for $40 million in a spirited auction.

International Property Developers North America Inc., a global company whose principals chose not to be identified, signed the contract behind closed doors.

The company's two representatives at the auction, who sat stoically in the front row, had little to say afterward.

In a prepared statement read by a U.S. Postal Service spokesman, the company said it looked forward to making the building a "focal point" for area residents and visitors. They provided little clue what they had in mind for the building.

"We are not prepared at this time to discuss our redevelopment plans, but we are looking forward to working collaboratively with the mayor, the alderman, and city staff to ensure the success of this project,'' the company said in a statement.

"To paraphrase Daniel Burnham, let me assure you that we shall make no small plans.''

The company has three days to make a 10 percent down payment, in addition to the $250,000 it posted to qualify as a bidder.

The auction attracted more than 100 people -- including bidders, media outlets, the curious and a documentary film crew.

Before the auction, the hallway outside the ballroom resembled more of a fashion show runway as people leaned against the wall to watch bidders register, grab their paddles and head into the ballroom.

The bidding started at the suggested minimum bid of $300,000 but quickly rose. By the time it reached $10 million, there were a handful of bidders participating. By the time it reached $17 million, there were only two.

The bidding pace slowed down when the price topped $20 million and then picked up again.

Forty-five minutes after it began, paddle No. 273 was declared the winner.

Most in the room were surprised at the purchase price. Auctioneer Rick Levin, whose firm handled the sale, said after the auction that there were plenty of buildings sold for vast sums in Chicago but those sales aren't transparent like the auction process.

He said he wasn't particularly surprised by the great interest because the building meets the first rule of real estate. "It's location, location, location, and this building has it," Levin said.

The building, which contains 2.5 million square feet and spans the Eisenhower Expressway and two city blocks, is so large that developers have struggled for more than a decade to come up with a workable plan for the vacant space.

The building's size, its historic designation and its proximity to nearby railroad tracks and the expressway have stalled previous attempts to use the building.

The 14-story, 77-year-old building has been vacant since 1995 when the Postal Service moved to a new building on Harrison Street. Since then, ideas floated for the space have included a casino, a water park and an auto mall.

Two years ago, the city gave initial approval to a plan that at one point was estimated to cost $300 million, including $62 million in local and federal incentives, to develop the complex into condos, offices and a hotel. However, the Postal Service was unable to finalize the deal with the developer.

The building's size falls between that of McCormick Place and Willis Tower. Since exiting the building, the Postal Service has been spending several million dollars annually to maintain the building and keep it secure.

A buyer would have to secure financing for any project -- a formidable challenge in today's tight lending environment -- as well as contend with the unknown of what the property taxes would be. Built in 1932 and once the largest postal facility in the world, the building has always been exempt from property taxes. Its assessed value would depend, in part, on its uses and the revenues derived from those uses.

Most in the room said they'd been to a real estate auction before.

Nevertheless, the auctioneer did a practice round of bidding to get people familiar with his pace and cadence. The mock auction's item was Wrigley Field. The bidding was stopped at $250 million.



mepodmolik@tribune.com
Copyright © 2009, Chicago Tribune


..

wow! 16$ per square foot. what a discount! of course, i guess all the cost will come into renovating the post office into something useful.

if the state and the city and the national culture weren't so against it, a nice casino/hotel would be my pick.

That's quite a price they paid.

Question is, do they really plan to develop this property or will they just hang onto in until the next real estate cycle and sell it for a profit?

".....International Property Developers North America Inc., a global company whose principals chose not to be identified, signed the contract behind closed doors...."

Who the heck ARE these guys? Is it a few players we already know who are hiding behind a generic name? Are they really developers? They seem to want us to believe that they are. Or are they flippers? They might be. The plot thickens!

wow! 16$ per square foot. what a discount! of course, i guess all the cost will come into renovating the post office into something useful.

if the state and the city and the national culture weren't so against it, a nice casino/hotel would be my pick.


From following this anything over 1M bucks is an overpay unless the buyer is looking into the long term. This could be a 2016 bet. Forget any hate for those that are unwiling to throw 40 million around just to insult people because they think they know more than the bidder. Shame on those haters that did not put up the min bid of 300K, I mean who would hate on those that bidded on this property.... really....



We can all be agast at the price but why should you care. One should be happy that this white E did not sell for 300K. At least there were 2 outside biders that wanted this thing. Be thankful and not ....

Kudos to the USPO.

If I had to venture to guess it would be that they have plans to rehab it somewhat soon. There is not much use to spend millions per year on upkeep and wait till better a next boom as it were. The economy seems it show signs of stabilizing or at least not headed for a 1931 free fall so someone with a long term vision understandably would be interested.
This is one piece of property whose stock likely went considerably up with all the talk about HSR. It is situated perfectly to be a unique destination complex for Midwestern's who travel by rail.

Article last week in suntimes about what to do with OPO.

http://www.suntimes.com/entertainment/weiss/1729725,CST-EDT-hedy23.article

What to do with Old Post Office? Go green

August 23, 2009

BY HEDY WEISS

.........I think I have an answer. It should warm the hearts of all those who believe in the importance of the green revolution and the necessity of water-reclamation projects.

It should excite all those who dream of having a plot of land that might rival Michelle Obama's White House kitchen garden.

It should intrigue all those who believe we should start thinking more seriously about "eating local."

And it should cheer all those who would like to see Chicago live up to its motto, "Urbs in Horto" ("City in a Garden") in a way that would attract the attention of the whole world, with an impact far greater and more enduring than any single summer Olympics.

Here's the plan: Have the federal government declare the building a tax-free innovation zone and turn it into a vast new national lab dedicated to the propagation, experimentation and support of all things green. Replace the roof with solar panels. Devise a water-reclamation and irrigation system that could operate throughout the building. Set up headquarters for a program dedicated to protecting and defending the entire Great Lakes region. And perhaps most alluring of all, take advantage of the building's unique weight-bearing construction to support a vast collection of indoor gardens that could be "rented out" for minimal fees (and on a sliding scale) to landless city dwellers. Schools -- from local grade schools to universities around the globe -- should be invited to be part of the mix. Scientists, architects, engineers and artists also should come on board.

Entice startups involved in green industries to locate in the building. Get local food wholesalers and major retailers to subsidize the growth of special produce that would not need to be hauled over long distances and could feed the city for less. Devote an entire wing of the building to creating an indoor "tropical rainforest" environment that might become the source of crucial pharmaceutical ingredients. (And no, I'm not talking about a giant marijuana farm.)

While brainstorming recently over dinner with several friends, including a Chicago architect, planner and developer who prefers not to be named here, more suggestions for the building came into play. He thought the Post Office would be an ideal spot for the Children's Museum (gardens and all), now that the controversial plans for a Grant Park site seem stalled. And he talked about a groundbreaking project called GreenPix that already exists in Beijing and could be adapted to the western and eastern facades of the building. (Using sustainable and digital media technology, GreenPix is a huge color LED display for a building's curtain wall that operates as a self-sufficient organic system, "harvesting solar energy by day and using it to illuminate the screen after dark.") A program of changing installations could attract media artists from around the globe and become the city's latest attraction..............

I don't put a lot of stock in her geen industries suggestion but the part about the Green Pix facade intrigued me. I know that some are against the floodlighting of downtown or anywhere in the city but I think it perhaps has potential here...........


http://blog.girvin.com/?p=1111
A company — GreenPix “has created an astounding combination of sustainable technology and digital media virtuosity, dubbed the Zero Energy Media Wall. The system features the world’s largest (so they claim) color LED display, powered completely by photovoltaic cells which are integrated into the glass curtain. During the day, the wall — located on the Xicui entertainment complex in Beijing — harvests solar energy, then expends the charge at night in a display of undulating colors.

This huge LED screen displays mesmerizing patterns of light and video to passersby. But the really amazing thing about the enormous wall of light is that it’s completely self-sustaining. That is, the light panels themselves harness the energy of the sun during the day to power a colorful light show at night.”

photos from the above blog
http://blog.girvin.com/wp-content/uploads/2008/05/light_02.jpeg

http://blog.girvin.com/wp-content/uploads/2008/05/light_04.jpeg


J_tjLUUW4So&feature=related
GreenPix - Dynamic Architecture

While the whole "green" idea is interesting, it'll never happen unless the buyers could figure out how to actually make money doing it. The last thing we need is for this building to fail yet again.

From following this anything over 1M bucks is an overpay unless the buyer is looking into the long term. This could be a 2016 bet. Forget any hate for those that are unwiling to throw 40 million around just to insult people because they think they know more than the bidder. Shame on those haters that did not put up the min bid of 300K, I mean who would hate on those that bidded on this property.... really....

what? ah, two people separated by a common language...

A few more images of the old proposal. Let's see what happens now.
http://img198.imageshack.us/img198/1699/383400483956e292b9a0b.jpg
http://img198.imageshack.us/img198/3196/383400718962115855e9b.jpg

Please God let those old plans or something extremely close to those plans come to fruition. I love the picture that's taken from the one tower looking over the middle section.

http://chicagoismynewblog.wordpress.com

^^

Me too! I love the renderings!! :cheers:

how on earth can anyone make a 40 million dollar bid without anyone knowing who did it?

Tonight on Chicago Tonight they said the buyer was from oversees. :gossip:

The buyer is from overseas? This is cloak-and-dagger stuff.

http://www.suntimes.com/business/roeder/1759880,CST-NWS-roeder09.article

The man who bought old Post Office
REAL ESTATE |
Past says be skeptical of Bill Davies

September 9, 2009

DAVID ROEDER droeder@suntimes.com

The mysterious buyer of the Old Chicago Main Post Office, 433 W. Van Buren, is Bill Davies, a globe-trotting investor who apparently has left a trail of broken promises in his former hometown of Liverpool, England.

Davies is in his 70s and is believed to reside in Monaco. People here have seen business cards of his that list offices in Monaco, London and Las Vegas.

Sources late Tuesday said Davies was the unidentified man who submitted the winning $40 million bid at an auction of the massive old post office Aug. 27. At the time, he refused to disclose his identity and said his company was International Property Developers North America Inc. The auctioneer and the building's seller, the U.S. Postal Service, played by his rules and would not disclose information about him, except for a statement in which the buyer pledged to "re-energize the property as a focal point and destination for the entire city."

If his history in England is any indication, Chicagoans should view those words with skepticism.

According to the Liverpool Daily Post, Davies has tried unsuccessfully to launch several projects in that city. His plan for a shopping complex in a central part of Liverpool called Chavasse Park dragged on for years until the local council pulled his legal right to the property. Davies charged that the action cost him about $160 million in lost profits. He ended up settling with the council in 2008 for what the Daily Post said was a payout worth about $3 million.

He apparently is best known in Liverpool for ownership of Aintree Racecourse, home of the Grand National Steeplechase. He pushed an unrealized plan in Liverpool involving a large old post office, so the man seems to have a thing about them.

Sources said Davies has hired the prominent law firm of DLA Piper to advise him on zoning issues and on dealings with the city regarding the Chicago site. The old post office spans the Eisenhower Expy. and is listed on the National Register of Historic Places. Davies, who has given few interviews over the years, did not return a message left at his room at the Ritz-Carlton Chicago.

Last week, he posted the required 10 percent of the purchase price. Closing has been set for Sept. 30, when Davies must put up the balance of the total $41.2 million. The amount includes a 3 percent premium due to the auctioneer, Rick Levin & Associates Inc. If Davies fails to close, he forfeits his deposit and the postal service again will have to decide what to do with the building.

A 2007 Daily Post article quoted a Davies associate as saying, "He loves owning property and in fact when he has money rather than property he finds it much less exciting." That seems an apt description for a man who laid out millions more than local developers thought the post office was worth.

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:badnews:

Oh crap.

Here comes another Block 37 to go along with the still unfinished original Block 37.

http://www.chicagotribune.com/business/chi-thu-post-office-bill-davies-sep10,0,670652.story

Buyer of old Chicago post office not known to deliver on projects
English developer Bill Davies has let several other properties languish

By Melissa Harris

Tribune reporter

September 10, 2009

.........Ald. Robert Fioretti (2nd) identified the purchaser as Davies. Other sources confirmed he was the winning bidder, and one person familiar with the deal said Davies wants to convert the building into a shopping mall with free indoor parking.

Davies did not return a message left with his assistant at a Chicago hotel where he is staying, and it is unclear whether he has any partners in the deal.

The Postal Service, auctioneer and DLA Piper, the law firm assisting him with zoning issues, all declined to comment, citing the bidder's demand for anonymity as he posted a $4 million deposit last week. News of Davies' purchase was first reported by the Chicago Sun-Times.

Asked about Davies' track record of sitting on large developments, Fioretti said, "I am concerned. He has to have a lot more wherewithal to make this happen than just the opening bid. ... It's the biggest eyesore in the city right now. I hope he's ready to proceed at a quick pace."

This is not the first time Davies, who has appeared on the Times of London's list of England's richest people, has bought an abandoned post office. He bought Liverpool's facility in 1986 and then sold it 16 years later in the same blighted condition he bought it, much to the ire of Liverpool leaders.

"Good luck, Chicago, is my blunt take on it," Flo Clucas, deputy leader of Liverpool's City Council, said in a phone interview. "The history we have of Mr. Davies and his company is long-winded and desperately difficult."

The conflicts repeatedly made headlines. In 1996, Davies paid Liverpool's city council 25,000 pounds for the option to develop a shopping center on a park. In 2002, after little or no movement, Davies lost the rights to develop the site to the Duke of Westminster's development firm, which quickly moved forward. The city council settled the legal dispute with Davies.

"We reached an accommodation to get rid of him," Clucas said.

In another deal in the late 1980s, Davies bought a historical site called Exchange Flags and again let it sit virtually vacant, Clucas said. In 2002, he returned a 4.5 million-pound city grant he received for the redevelopment efforts, again as part of a settlement, Clucas said.

Davies' first prominent purchase was of Aintree racecourse, home to England's Grand National, in 1973. Soon, he tripled admission prices, which led to all-time attendance lows and the near-collapse of the event, according to Aintree's Web site and news reports.

"He didn't do anything wrong; he just sat on key sites that really held up redevelopment in the city," said Larry Neild, the former city editor at the Liverpool Daily Post, who now works in public relations. "There was a huge sigh of relief when he disposed of his last Liverpool interests. The council was really glad to see the back of him."

Davies' version of these disputes has never been told in the British media because the developer "never gives interviews," Neild said. "He's a very secretive guy," Neild said. "He doesn't put himself about."..................
..

UGH, if this were a movie i wouldn't believe it. :(

http://www.suntimes.com/business/1799251,chicago-old-post-office-deal-093009.article

Old post office deal now in question


September 30, 2009

BY DAVID ROEDER Staff Reporter
The sale of the Old Chicago Main Post Office remained a muddled affair today after the buyer who won it at auction missed a deadline to close the deal.

Bill Davies, a globe-trotting investor who pledged $40 million for the vacant hulk at the Aug. 27 auction, did not close the sale despite having the available funds, said an attorney representing him. The property’s seller, the U.S. Postal Service, had him put down a $4 million deposit after the auction and he was required to pay the balance by today.

Why he did not couldn’t be determined. The postal service said in a statement that the sales contract gives Davies a 10-day “cure period,” extra time to rectify any defaults, and that it will work with him in the meantime.

“The contract stipulates that the buyer still has until Oct. 10, a 10-day period, in which to settle and acquire the property, after which time the buyer relinquishes all rights to the property,” the statement said. “We are disappointed with the turn of events but given the interest shown during the
auction process, we will be reviewing our options.”

Those options could include opening talks with the bidder who finished second at the auction with a last offer of $39.5 million. That bidder is Investor Immigration Funds Inc., a partnership represented by Chicago immigration lawyer Nathaniel Hsieh.

Hsieh said his group intends to close the sale in 15 days if given the chance. He said he expects to be the ultimate purchaser of the 2.7-million-square-foot building that spans the Eisenhower Expy.

“If they can’t close today, they’re not going to close in 10 days,” he said of the Davies bid. “We can get this done. Legally and economically, it just makes sense for the seller to to come to us.”

Hsieh said his group consists of mostly Chinese and Russian investors. “This is actually our very first venture,” he said.

The post office, 433 W. Van Buren, has been the subject of many plans over the years and is listed on the National Register of Historic Places.

Davies has not explained what he wants to do with the property and has avoided interviews. He has failed at a number of attempts to redevelop parts of Liverpool, England, is former hometown.

Hsieh said his team wants to take over plans previously developed for the post office. Crafted Walton Street Capital, the plan called for razing part of the massive building and retrofitting the rest of it for a hotel, offices and condominiums.


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This is actually our very first venture.

Not exactly comforting to hear...

http://www.suntimes.com/business/roeder/1810321,CST-FIN-roeder07.article

REAL ESTATE | High office vacancies bad news for landlords
October 7, 2009

DAVID ROEDER droeder@suntimes.com

..........POSTAGE DUE? A source close to Bill Davies, the would-be buyer of the old Main Chicago Post Office, insists Davies is "working collaboratively" with the U.S. Postal Service in trying to close the $40 million sale. He has to do it by Saturday or the postal service can go to its No. 2 bidder, a group represented by Chicago lawyer Nathaniel Hsieh.

However, the Hsieh bid of $39.5 million relied on money from China. Sources say the Chinese interest in the transaction diminished after Chicago lost its Olympics bid.

The postal service could have to resort to another auction to unload this 2.7-million-square-foot giant. But it could decide to wait on a new auction until the capital markets improve. Davies and the Hsieh group were the only parties at the property's well-attended Aug. 27 auction to escalate the bidding to a realm where local experts believe only fools dwell................


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agreed. d'oh!

http://www.chicagotribune.com/business/chi-old-post-office-oct13-,0,6037538.story

Old post office building back on the block
Post office hopes to strike a deal with runner-up bidders

By Melissa Harris

Tribune reporter

6:00 p.m. CDT, October 13, 2009

The U.S. Postal Service will turn to other bidders from its August auction of the city's old post office in the hopes of finding a buyer for the behemoth building, a spokesman for the government agency said late Tuesday.

Mark Reynolds, the spokesman, said that British developer Bill Davies, who had won the auction with a bid of $40 million, is no longer a potential buyer. Asked whether the postal service would return Davies' $4 million deposit, Reynolds said, "It does not look that way."

Reynolds said the post office hopes to announce a buyer by the end of October.

Reached by phone Tuesday, Davies said, "I'm on the other line. No comment."

The runner-up bidder at the August auction was Nathaniel Hsieh, a Chicago attorney, who said he wanted to use the purchase of the building to help his foreign investors obtain visas through a federal program.

Hsieh said Tuesday that rather than exercise the back-up contract he had on the property, the postal service is mailing a letter to all of the auction participants to solicit new bids.

"It's an outrage," he said. "We're filing a complaint in morning. It's unfair."

The property, located on W. Van Buren Street, straddles the Eisenhower Expressway and has been vacant since 1995. It is between the size of McCormick Place and Willis Tower.

mmharris@tribune.com
Copyright © 2009, Chicago Tribune

Bill Davies sounds like a bit of a dunce so I don't care much, but just can the PO keep the whole deposit.

A BIT of a dunce? He spent four million bucks for bad press and lots of paperwork for his attorneys. I'd say he's a complete moron. (but that's just me.)

Yeah, who the frack puts a 4 million deposit and a 40 million dollar bid when they don't have the money put together? Especially given this guy's development track record, good riddance, and thanks for the 4 million donation.

After negotiating a revised post-Olympic price, Davies has closed on the purchase.

http://www.chicagorealestatedaily.com/cgi-bin/news.pl?id=35882

They ended up selling it to the slacker after all. Crap.

http://www.suntimes.com/business/roeder/2119430,CST-NWS-roeder24.article

Developer taps a Daley in negotiations with city
REAL ESTATE | Law firm of mayor’s brother picked to deliver post office

March 24, 2010

BY DAVID ROEDER droeder@suntimes.com
Bill Davies, the mysterious British investor who acquired the old Chicago Main Post Office last year, is getting serious about its redevelopment.

How serious? He has hired the law firm Daley & George Ltd. to represent him in negotiations with the city. The "Daley" in the name refers to Michael Daley, the mayor's brother. The "George" is Jack George, who handles most of the firm's real estate work and is an acknowledged expert in zoning.

George quarrels with perceptions that developers hire him to gain access to Mayor Daley and leverage with city planning officials. He said clients trust him to "tell it to them straight" and suggest changes that will ensure a project passes legal and political tests. George said he's turned down work for developments he felt were ill-conceived.

"Every project, certainly all the big ones -- they are scrutinized by so many people and by every community group going," George said. "You have to get the thing approved or not based on merits."

George said Davies is hiring local specialists to help with the massive old post office. Davies got it for $25 million after earlier pledging $40 million to buy it at auction, only to back out of the deal. He has business interests overseas but has failed at several attempts to develop property in Liverpool.

Since becoming a Chicago enigma, Davies has declined interviews and issued just a single statement promising to "re-energize the property as a focal point and a destination." George said he has yet to see plans for the building. At 2.7 million square feet, the building crosses the Eisenhower Expy. and forms a shabby gateway to downtown.

Davies is "kind of difficult to get a hold of," George said. "He's a nice man. I think he's dedicated to the project."

Ald. Robert Fioretti, whose 2nd Ward includes the old post office, said he's due to discuss details with Davies during the first week of April. Fioretti said talks with Davies or his representatives so far have involved housekeeping matters, such as scaffolding on the exterior and issues related to multiple rail lines into the property. Some people have suggested the building is well-situated for high-speed rail.

Fioretti said Davies has spoken about tackling the Harrison Street side of the building first, renovating it for parking and retail space, and perhaps adding to the number of residences from an earlier plan. In 2008, Walton Street Capital wanted to include a hotel and 300 condominiums in the building, but the project never advanced. "I believe Davies will come out with a very bold plan," Fioretti said.

The developer also will be asking for a city subsidy, another issue involving Daley & George. The firm is working on similarly complex real estate, such as the proposed Chicago Spire on the lakefront and the proposed renovation of Willis Tower, formerly Sears Tower. Also, George is the lawyer for the receiver running the Block 37 retail complex, which is in foreclosure.

Last year, Davies discussed the post office job with the architectural firm Gensler. The firm has large operations in London and Chicago and is known for its interior design. Gensler's regional managing principal in Chicago, Lamar Johnson, said he'd love to be involved, but "I haven't seen hide nor hair of him since then."





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The developer also will be asking for a city subsidy, another issue involving Daley & George. The firm is working on similarly complex real estate, such as the proposed Chicago Spire on the lakefront and the proposed renovation of Willis Tower, formerly Sears Tower. Also, George is the lawyer for the receiver running the Block 37 retail complex, which is in foreclosure.

Yeesh, what a heck of a portfolio to have right now - three floundering projects??

Davies is "...kind of difficult to get ahold of." Maybe he is hiding out with Garret Kelleher.

Yeesh, what a heck of a portfolio to have right now - three floundering projects??

Just a function of numbers. Daley & George probably does 80 percent of the PD and downtown rezoning work.

http://www.suntimes.com/business/roeder/2181846,CST-NWS-roeder21.article

Old post office plans: New York architect in the mix
REAL ESTATE | Firm worked on one Chicago project: 190 S. La Salle building

April 21, 2010

BY DAVID ROEDER Sun-Times Columnist
Bill Davies, the moneyed mystery man from Britain who owns the old Chicago Main Post Office, is in town this week concerning a redevelopment of the huge building at 433 W. Van Buren. He hasn't spoken with reporters since getting the property last fall for $25 million, but a few details are sneaking out.

One is that he has hired for the assignment a New York architectural firm that traces its lineage to the late Philip Johnson, who used classical decoration to dress up the glass-box style associated with Ludwig Mies van der Rohe. The firm is Philip Johnson/Alan Ritchie Architects.

Principal Alan Ritchie worked on the firm's one Chicago development, the 190 S. LaSalle building that opened in 1987.

Ritchie said he's been working on the post office site for a couple of months. "We're just exploring the possibilities," which he said include adding to some sections of the building. He declined to say if Davies wants to add a tower to the structure, now 14 stories at its tallest points. But Ritchie said that's one way of making a "signature statement" with the building.

Also, a source said Davies has hired Howard Blair, president of Chicago-based Development Resources Inc., as project manager. Blair did not return a call.

There's no project yet for him to manage. Davies still has to draft plans that pass muster with city officials and community groups. I reported last month that Davies has hired the connected law firm Daley & George Ltd. to help smooth the City Hall waters.

If Davies is serious, I wouldn't be surprised to see him take on more partners with Chicago credentials. One possibility would be developer John Buck, who worked with the Johnson-Ritchie firm on the 190 S. LaSalle building.


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http://www.chicagojournal.com/News/03-09-2011/Post_office_buyer_looking_for_more

Post office buyer looking for more

03/09/2011 10:00 PM

The developer who bought the Old Main Post Office building on Congress Parkway is building on his investment.

Bill Davies, the British developer who bought the 3 million square foot building at auction from the U.S. Postal Service in 2009 for roughly $24 million, has bought a building next door for about $14 million, according to Crain’s Chicago Real Estate Daily.

The building, just to the east of the post office, was also owned by the Postal Service.

Crain’s speculated that the building’s land could be used to build a new ramp to the Old Main building from Congress Parkway...

^^ Hmm, will be kind of disappointing if he decides to tear it down, and it would prove to be one expense ramp, to boot! That's a nice, traditional Chicago warehouse on the SE corner -- and there aren't too many of those left in the Loop district. Plus it would be a huge loss to the Harrison street-scape if it get's replaced with a mere ramp. Not to mention, when I was at the main Post Office during Christmas, I could've sworn USPS were still using that building as I saw trucks driving in and out of the building. Hopefully the developer will find a use for it - maybe he can incorporate it into his plans for the post office building itself. Actually, he might be able to use the building as a parking garage and just build a bridge/ramp connecting the two buildings on the third floor or so???

I still have no idea what the plan is for this building. Museum of Paper Cuts?

New news today:


http://www.chicagotribune.com/business/breaking/chi-old-chicago-post-office-redevelopment-plan-unveiled-20110721,0,3150609.story

The owner of the Chicago's behemoth old post office building on Thursday unveiled a grandiose plan for redeveloping the long-vacant property and the area around it, including a 2,000-foot skyscraper that would dethrone the Willis Tower as the city's tallest building.

The owner, British developer Bill Davies, promises to transform the area into an "urban mecca" of five residential, office and hotel towers. Yet the three-phase project, which Davis wants to complete in 10 years, faces major economic hurdles, real estate experts said.

Completed in 1932, the post office building was once the world's largest post office. The building, which straddles the Congress Street feeder ramp leading to the Eisenhower Expressway, has been vacant since 1995. It has been the subject of several redevelopment plans, none of which have succeeded.

Davies bought the historic post office building in 2009 for $24.8 million, and is apparently convinced it has a future as something other than a white elephant.

"His concept is that it is not big enough," said Laurence Booth of the Chicago firm Booth Hansen, the designer of the project.

The first phase of the $3.5 billion project calls for converting the inside of the Old Post Office into retail shops and hotel rooms. The west side of the building will house a garage with ramps that would feed directly into Congress Parkway. The Beaux Arts-inspired marble and gold lobby will be restored to its original glory and would serve as the entrance to the shops and a 40-story hotel that would boast views of the Chicago River.

Davies plans to expand the project into three other sites: An empty lot south of West Harrison Street tucked between the Chicago River and South Wells Street; a lot south of Congress Parkway now home to a Holiday Inn and a parking lot; and the site adjacent to the Old Post Office known as the "Sugar House."

He has rights to buy the those properties but has not closed on the deals.

The plan, which was filed with the city on Thursday, is expected to be introduced to the City Council next week. It would then be reviewed by the housing and economic development staff. Typically, such a process can take months.

Once the plan is approved, the company can move with the $450 million first phase within 90 days, said Martin Mulryan, International Property Developers project manager.

Each phase would take three years each to be completed. The second phase, at a cost of about $2 billion, calls for a hotel in the current site of the Holiday Inn and adjacent parking lot, and a 120-story skyscraper at the site of the Sugar House to be used for office, hotel and residential space. The buildings will be raised over a 10 floor platform that would house more retail space.

The final phase calls for the development of the now empty site at the river. It will house 10 floors of retail space and a parking lot. Two 60-story residential towers will be built on top.

All sites will be connected with pedestrian bridges. To connect the site across the river, Davies plans to built a multi-story bridge with space for more retail shops and restaurants.

Peter Strazzabosco, a spokesman for the city's Department of Housing and Economic Development said the developers had met with city staff periodically over the last two years, but declined to comment on the plan or its political prospects.

Booth, the designer of the project, is a well-respected member of Chicago's often-contentious community of architects. But he has never completed anything of this scale.

Booth's finest projects, such as his award-winning renovation of Old St. Patrick's Church at 140 S. Desplaines St., have been considerably smaller. He has designed skyscrapers, however. His largest completed one to date is the 31-story Joffrey Tower at 151 N. State St., which combines retail space, condominiums and the Joffrey Ballet's offices and studios.

Booth also is no stranger to controversial skyscraper plans -- and to the difficulty in getting them built.

In 2007, along with developers James Klutznick and Tim Anderson, he unveiled his design for a 49-story, glass-sheathed condominium tower in north suburban Evanston. At 523 feet, it would have been the tallest building in Chicago's suburbs.

But many Evanston residents argued that the tower would be an over-scaled monstrosity and would uproot local merchants. In response, the plans were dramatically downscaled and in 2009, Evanston approved a downtown height limit of 35 stories.

The project has yet to break ground.

Davies, who has appeared on the Times of London's list of England's richest people, bought a dilapidated post office in 1986 in Liverpool, England and sold it 16 years later in the same condition, angering local politicians.

More on this:

Chicago Real Estate Daily (http://www.chicagorealestatedaily.com/article/20110721/CRED03/110729952/skyscrapers-retail-part-of-massive-old-post-office-plan#ixzz1SmfbaCPX)

Skyscrapers, retail part of massive Old Post Office plan

By: Alby GallunJuly 21, 2011

http://www.chicagorealestatedaily.com/apps/pbcsi.dll/storyimage/CG/20110721/CRED03/110729952/AR/AR-110729952.jpg&maxw=368&q=100
(Crain's) — The owner of the Old Main Post Office has unveiled an audacious plan to transform the hulking structure and surrounding properties into a massive complex spanning the Chicago River that would include a shopping center, hotels, more than 1,000 residential units and the tallest skyscraper in North America.

The 120-story tower is the centerpiece of a $3.5-billion, 16-million-square-foot development proposed by Bill Davies, the Englishman who paid $24 million two years ago for the post office, an empty landmark structure that straddles the Congress Parkway on the west side of the river.

“He sees this as a gateway to the city,” says Martin Mulryan, the project manager overseeing the development.

Mr. Davies aims to create a destination for Midwesterners that will include entertainment, restaurants, shopping — but not a casino, as some observers have expected. Attractions could include theaters and music venues.

Given the project's size, cost and complexity, skeptics will doubt Mr. Davies' ability to pull it off in a real estate market still recovering from the crash of 2008. The development is heavy on retail, currently one of the weakest property sectors.

Yet construction is expected to take 10 years or more and will be phased, allowing the developer to build as demand for space returns, Mr. Mulryan says.

Covering 20 acres, the project would include 6.2 million square feet of retail and entertainment space, 7,500 hotel rooms, 2 million square feet of office space and 3.8 million square feet of residential space, enough for about 1,500 units. It also is to include 12,000 parking spaces that will be free for shoppers.

“That's the idea, to have everything,” says Laurence Booth, principal of Booth Hansen, the Chicago-based architecture firm working on the project. “So people will come from all over — by car, by train, by boat and get everything they want.”

Representatives of Mr. Davies' firm, International Property Developers, submitted documents to the city Thursday afternoon to support zoning changes allowing the development, the beginning of an approval process that could last several months or even years.

Mr. Davies aims to begin construction on the first phase — the redevelopment of the post office building at 433 W. Van Buren St. — within 90 days of receiving city approval. He plans to convert the post office building into retail, parking and hotel space.

In the next phase, he plans to develop a property to the west of the post office, currently the site of a Holiday Inn, into more retail space for big-box retailers and a hotel tower.

He wants to build more retail and the 120-story tower immediately to the east of the post office. A multistory bridge crossing over the Chicago River would connect to another structure that would include yet more retail and two residential towers.

The developer has signed contracts to buy the neighboring properties, but Mr. Mulryan declines to disclose terms. One parcel, on the east side of the river, is listed for $41 million.

At 16 million square feet overall, the proposed project is more than six times the size of a previous redevelopment plan by Chicago-based Walton Street Capital LLC, and bigger than many observers expected. Crain's first reported in June that Mr. Davies' was working on a large project that would include neighboring parcels.

Premium content: Davies' bazaar dream

Mr. Davies saw the Post Office “not as something big, awkward and difficult,” says Mr. Booth, the architect. “He saw this as something not big enough.”

The question is whether he will be able to attract retailers, hotel investors, office tenants and residents to a project on the fringe of downtown Chicago — and then whether he can find lenders to finance the project. The development team has received inquiries from hoteliers and retailers but won't start marketing the project formally until the city signs off on it.

“It's a very ambitious project in the market for a location that's a little off-center,” says Richard Souyoul, president of Chicago-based Souyoul Development Group.

But Mr. Davies is undaunted. “Years ago, there were those who doubted the Museum Campus and those who doubted Lakeshore East or Millennium Park,” Mr. Davies says in a news release. “I would challenge any cynic to look to those developments and then tell me this can't be done. I am confident that with the correct focus and energy and by working in partnership with this great city, that we will achieve our goal.”

The current plan does not include financial assistance from the city in the form of tax-increment financing, a subsidy that developers often seek for complex projects. Yet Mr. Davies hasn't ruled out seeking TIF money for some costs, says his lawyer, Jack George of Daley & George Ltd.

Mr. Davies also doesn't plan to include a casino in the project, a possibility today with a bill to expand gambling in Chicago sitting on Gov. Pat Quinn's desk. “None of this hinges on or has anything to do with a casino,” Mr. Mulryan says.

Though the City Council must ultimately approve Mr. Davies' proposal, he has the support of a key member: Alderman Robert Fioretti (2nd), whose ward includes the post office.

"The plans are appropriately ambitious," he says. " It shows a vision that will transform this critical city gateway."


Read more: http://www.chicagorealestatedaily.com/article/20110721/CRED03/110729952/skyscrapers-retail-part-of-massive-old-post-office-plan#ixzz1SmfbaCPX
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A quick look at the site from the negotiations:

http://www.chicagobusiness.com/apps/pbcsi.dll/storyimage/CG/20110618/ISSUE01/306189982/H3/H3-306189982.jpg&maxw=368&q=100

Chicago Tribune (http://www.chicagotribune.com/business/breaking/chi-old-chicago-post-office-redevelopment-plan-unveiled-20110721,0,3150609.story)


Old Chicago post office redevelopment plan unveiled
By Alejandra Cancino and Blair Kamin
Tribune reporters

5:48 p.m. CDT, July 21, 2011

http://www.chicagotribune.com/media/photo/2011-07/161307400-21133545.jpg

The owner of the Chicago's old post office building on Thursday unveiled a grandiose plan for redeveloping the long-vacant property and the area around it, including a 2,000-foot skyscraper that would dethrone the Willis Tower as the city's and North America's tallest building.

The owner, British developer Bill Davies, promises to transform the area into an "urban mecca" of five residential, office and hotel towers that would draw visitors from around the Midwest. Yet the three-phase project, which Davies wants to complete in 10 years, faces economic hurdles due to the weak economy and still struggling retail sector. "It's a pipe dream -- is it doable?" said Gail Lissner, vice president of Appraisal Research Counselors in Chicago.

Completed in 1932, and located at 433 W. Van Buren St., the massive building was once the world's largest post office. The building, which straddles the Congress Street feeder ramp leading to the Eisenhower Expressway, has been vacant since 1995. It has been the subject of several redevelopment plans, including a casino, a water park and an auto mall. None have succeeded.

Davies bought the building in 2009 for $24.8 million, and is apparently convinced it has a future as something other than a white elephant. While Davies doesn't spell out plans for a casino, Lissner said his plans could accommodate one. For now, his vision is for 6.2 million square feet of leisure, retail and entertainment space; 4.1 million square feet of hotels; 2 million square feet of office space; and 3.8 million square feet of residential space ; a total of 16 million square feet. "His concept is that it is not big enough," said Laurence Booth of the Chicago firm Booth Hansen, the designer of the project.

The first phase of the $3.5 billion project calls for converting the inside of the Old Post Office into retail shops and hotel rooms. The west side of the building would house a garage with ramps that would feed directly into Congress Parkway. The Beaux Arts-inspired marble and gold lobby would be restored to its original glory and serve as the entrance to the shops and a 40-story hotel with views of the Chicago River.

Davies plans to expand the project into three other sites: An empty lot south of West Harrison Street tucked between the Chicago River and South Wells Street; a lot south of Congress Parkway now home to a Holiday Inn and a parking lot; and the site adjacent to the Old Post Office known as the "Sugar House." He has rights to buy the those properties but has not closed on the deals. Davies has secured financing for the first phase of the project, but will need financing for the other two phases, said Martin Mulryan, project manager for the Davies-owned International Property Developers.

The plan, which was filed with the city Thursday, requires City Council and Plan Commission approval. If the plan is approved, the company can move ahead with the $450 million first phase within 90 days, Mulryan said. Each phase would take three years each to be completed. The second phase, at a cost of about $2 billion, calls for a 60-story hotel on the current site of the Holiday Inn and adjacent parking lot, plus a 120-story skyscraper at the site of the Sugar House. It would be used for offices, hotel and residential space. The buildings would be raised over a 10-floor platform that would house more retail space.

The final phase calls for the development of the now empty site along the river. It would house 10 floors of retail space and a parking lot, forming a foundation for two 60-story residential towers. All together, the 10-story base would contain parking for 12,000 cars. The majority will free for shoppers. "The only way you are going to get people to come in from the burbs is by car," Booth said.

The 120-story tower would measure 2,000 feet to its roof, making it more than 500 feet taller than the Willis Tower. If built, the tower would top the 1,776-foot One World Trade Center now under construction in New York City. Communications antennas would spring from its roof, generating revenue for the owner. To connect the building's retail spaces on both sides of the river, Davies plans to build a multi-story bridge with space for more retail shops and restaurants. Such a move could prove controversial because it would block views of the river.

Peter Strazzabosco, a spokesman for the city's Department of Housing and Economic Development said the developers had met with city staff periodically over the last two years, but declined to comment on the plan. Davies, who has appeared on the Times of London's list of England's richest people, bought a dilapidated post office in 1986 in Liverpool, England and sold it 16 years later in the same blighted condition, angering local politicians.

The future of Davies' project depends of the ability of companies to create jobs, said Chris Macke, senior real estate strategist for the CoStar Group, a real estate research firm. "If people are hired, more people would stay in hotels, more people would buy condos and rent apartments," Macke said. But Lissner said that while the Davies' plans are ambitious, his multi-phase project would take years to finish and could benefit from an improved economy. Its advantages are that it would sit close to the expressways, the CTA Blue line and Union Station. Despite the tough economic climate, Booth predicted, people will eventually flock to the complex because they have "an insatiable appetite for experience and excitement and places they haven't been."

Experience shows that it is far easier to announce plans for a towering skyscraper than to build one. Another overseas developer, Ireland's Garrett Kelleher, promised to build the 2,000-foot Chicago Spire -- only to see his dream collapse and his creditors file lawsuits demanding millions of dollars in payments. For three years now, construction on the 1,047-foot Waterview Tower at 111 W. Wacker Dr. has been halted at the 26th floor, leaving its exposed concrete skeleton looming over the Chicago River.

Booth is no stranger to controversial skyscraper plans -- and to the difficulty in getting them built. In 2007, along with developers James Klutznick and Tim Anderson, he unveiled his design for a 49-story, glass-sheathed condominium tower in north suburban Evanston. At 523 feet, it would have been the tallest building in Chicago's suburbs. But many Evanston residents argued that the tower would be an over-scaled monstrosity and would uproot local merchants. In response, the plans were dramatically downscaled and in 2009, Evanston approved a downtown height limit of 35 stories.

The project has yet to break ground.

---

Even if I were in favour of another supertall proposal for Chicago, I wouldn't want any supertall buillding (especially one that is 2000-ft high) get built near 233 South Wacker Drive. if I wanted that tower built, it would be moved to the old Chicago Spire site. No one can think of any good plans for the Old Post Office site. Throw all those towers out, they're gonna end up being white elephants.

Sorry but I never want to hear about a 2000' building in Chicago EVER again! 1999' or 2001' is fine by me but 2000' NEVER AGAIN!!!! lol

Sorry but I never want to hear about a 2000' building in Chicago EVER again! 1999' or 2001' is fine by me but 2000' NEVER AGAIN!!!! lol

I know, "here we go again", right? If nothing gets done but a rehab of the old post office, I'm happy. Anything else is icing on the cake! ;)

Honestly just reuse the building or tear the Post Office down and build two 40-60 story towers on both sides of Congress Parkway in the span of ten years. What is up with these british developers wanting to build property in Chicago that have no chance of ever happening?

http://www.chicagorealestatedaily.com/apps/pbcsi.dll/storyimage/CG/20110721/CRED03/110729952/AR/AR-110729952.jpg&maxw=368&q=100

Aww...man. That will NEVER happen.

^^
Take a bow, STR: http://ny.curbed.com/archives/2011/07/22/motherlode_of_worlds_tallest_buildings_illustrated_by_height.php

:)

^While that's kind of cool, I ended up being much more interested in the article on the naked woman.

Honestly just reuse the building or tear the Post Office down and...

Stop right there.

We've lost too many pre-WWII buildings already, and this one looks gorgeous from Harrison or Van Buren Streets.

Sorry. They did the right thing by landmarking it before anyone had the chance to demolish it.

Even if I were in favour of another supertall proposal for Chicago, I wouldn't want any supertall buillding (especially one that is 2000-ft high) get built near 233 South Wacker Drive. if I wanted that tower built, it would be moved to the old Chicago Spire site.

It depends on the intended use of that supertall building.

I personally don't care for "world's tallest" or "North America's tallest" titles, but a new, moderately-tall supertall (maybe around as tall as Trump or AON) could very well fit this general area just southwest of the Loop, provided we're talking about a tower that would primarily house office space (given if there's any demand for additional office space in Chicago), and maybe some residential, but no hotel.

If we're talking about hotel or entirely-residential, then the area you mentioned (the Spire site...not sure if that's considered part of Streeterville), then yes, that location is much more appropriate for residential/hotel, and maybe some retail and restaurant.

But if we're talking about expanding the CBD a few blocks southwest of the official Loop, to encompass the area around the old post office, then a supertall office tower in the vicinity wouldn't be a bad idea...just a block from Metra's LaSalle St Station and LaSalle Blue line, a couple blocks from CTA's LaSalle/Van Buren station as well, and not terribly far from Union Station, it'd be very convenient for bringing more workers into the city. The only downside is that, with Congress Parkway turning into the Eisenhower Expressway in that same exact area makes the spot pedestrian-unfriendly. So, any expansion of the CBD in this direction would have to address this problem.

However, the Davies/Booth proposal is absolutely hideous for all the reasons well-articlated here: Plan for old post office: A suburban throwback, and a pipe dream (http://www.chicagotribune.com/news/local/ct-met-postoffice-kamin-0724-20110724,0,992140.story) (Chicago Tribune).

Personally, I'd locate the supertall in the empty lot just south of Harrison and between Wells and the river. But not the ugly tower designed by Booth.

Stop right there.

We've lost too many pre-WWII buildings already, and this one looks gorgeous from Harrison or Van Buren Streets.

Sorry. They did the right thing by landmarking it before anyone had the chance to demolish it.


lol I agree that if it's restored it could look great but honestly in my opinion it's too bulky and it doesn't do much for the area. If anything I would save the two side torrents(or whatever their called) and destroy the section over Congress. Just my opinion.

Of all the recent supertalls (1000' plus) only one's I really wanted were the Waldorf, Waterview and Trump.

^While that's kind of cool, I ended up being much more interested in the article on the naked woman.

Heh heh. I hear ya! ;)

Waterview

The Waterview design was GORGEOUS.... sigh

The Waterview design was GORGEOUS.... sigh

I've always been a fan of the Park Hyatt and I've viewed Waterview as a more gorgeous more elegant version of that design.

I'm still getting over the loss of Waterview, Waldorf, the Spire. So seeing plans for another super tall in Chicago should get me excited. But for some reason im not excited at all for this.
It's so ugly and looks like its trying to one-up the Sears Tower with 4 antennas instead of two. And having it that close to the Sears tower is a huge no no for me the skyline would look stupid. I don't mind the smaller towers but please dont build the big one.

I actually didn't care for the Spire, but the Waterview was beautiful.

I don't care for Calatrava's skyscrapers, but I love his low-rise works. We need to bring him back for maybe [wishful thinking] a transit/high-speed rail/Amtrak/Metra/CTA hub in West Loop, maybe as an expansion of Union Station.

Hopefully they can redesign this and put something good on the site, Chicago has such an amazing skyline, they should add even more supertalls to it!

What's the chance of something getting built on the Spire site? (Not the actual spire itself of course but hopefully something tall)

Hopefully they can redesign this and put something good on the site, Chicago has such an amazing skyline, they should add even more supertalls to it!

What's the chance of something getting built on the Spire site? (Not the actual spire itself of course but hopefully something tall)

Although there is close to a 0% chance of the spire getting built, I did read an article from 2011, where it said this, " Despite all these dire signals, the Spire’s local broker, Golden of @properties, insists the project isn’t dead. “Death might be an overblown term. I don’t think it’s dead. [Shelbourne is] still actively trying to put something together,” Golden says.

Others are skeptical. “You can’t exactly dance on the grave. But as more time goes by, it’s less likely it will go ahead,” says Antony Wood, executive director of the Chicago-based Council on Tall Buildings and Urban Habitat, an association of architects, engineers and planners.

Here is the link http://timeoutchicago.com/arts-culture/art-design/166297/the-chicago-spire-debacle?page=0,5

For all those that love the Chicago Spire including me, it's not totally impossible, you can still hold on too some hope. If Shelbourne somehow runs into a lot of cash, you can probably bet that the Spire will be built, because since he owns the land, no one else can build on it.