More apartments near Chicago casino site proposed

The new proposal — which is subject to City Council approval — adds to the mix of projects poised to transform the River West neighborhood, a pocket of the riverfront long-dominated by construction and manufacturing businesses that is gradually giving way to a postindustrial future. Onni is also raising its bet on the downtown apartment market, which has been a bright spot for landlords with high rents and occupancy even as commercial property types like offices and retail labor to reach pre-pandemic levels of demand.

Onni has already been wagering on downtown Chicago’s post-pandemic recovery in other ways: It is revamping a vacant 31-story office building in the Loop, bought and rebranded the former Ace Hotel in the Fulton Market District and is building a 373-unit luxury apartment tower near the Fulton Market District. The developer late last year also proposed a new office building at 357 N. Green St. in Fulton Market.

An Onni venture paid just more than $45 million for the 700 W. Chicago property in June 2022, according to Cook County property records. The developer bought the site from a venture led by Irving, Texas-based Nexstar, which took control of the property in 2019 through its acquisition of Tribune Media. Tribune Media had previously teamed with Chicago developer Riverside Investment & Development on a proposal to demolish an existing 115,000-square-foot industrial building on the site and build a four-tower office and residential complex. But Nexstar and Riverside scrapped that plan during the pandemic, with demand for offices hammered by the remote work movement.

The first phase of Onni’s plan for the site would be an apartment building along Halsted and the Chicago River, which would include a tower rising 56 stories, according to the zoning application. The proposal also includes ground floor retail uses.

An Onni spokesman did not respond to a request for comment on the new plan.

Rents at top-tier, or Class A, apartments downtown in the first quarter averaged $3.61 per square foot, up 1.7% from the same period in 2022, according to appraisal and consulting firm Integra Realty Resources. Integra forecasted earlier this year that developers will complete 2,900 new apartments in downtown Chicago in 2023 and another 3,700 in 2024.

When Bally’s was competing in 2021 with other bidders to develop Chicago’s first casino, the gambling company had said it would acquire the 700 W. Chicago property — a former Chicago Tribune advertising insertion plant that ceased operations in 2012 — and develop a temporary casino there while it was building a permanent one. But Bally’s ultimately reached a deal to open a temporary casino in the Medinah Temple building at 600 N. Wabash Ave.

Bally’s won City Council approval in December to develop its 1 million-square-foot casino and hotel complex and recently got an operating permit from the Illinois Gaming Board for the temporary Medinah site. The company still needs the board’s approval for a license to operate a permanent casino on the 30-acre property occupied today by the Chicago Tribune’s Freedom Center printing plant.