What’s That Building? Trump Tower
What's That Building? Well, in this case, it's hard not to know, since the owner's name is emblazoned on the side in letters 20 feet high.
Crain's Chicago Business real estate reporter Dennis Rodkin joined Morning Shift to share details about this controversial tower for the latest installation of "What's That Building." Here are some takeaways from Rodkin.
The Trump International Hotel and Tower, the combined hotel and condominium tower 95 stories high on Wabash Avenue at the river, opened in parts beginning in January 2008. Now, nine years later, developer Donald Trump's presidency also launches in January.
Let's be clear that we're talking about the building named Trump, not the man, although for many people it's hard to separate the two. That became clear this fall, when after Trump won the presidential election, Chicago protesters targeted the sidewalks around his hotel and condo tower as the place to register their disdain for him.
The design, led by Adrian Smith for the firm Skidmore, Owings & Merrill, is sleek; its rounded edges, stainless-steel ribs and steely-blue glass soaring up 1,389 feet from its site at a slight bend in the Chicago River. Its spire, which a lot of people think is too spindly for such a massive building, is sometimes visible from spots well outside the city on the Edens and Eisenhower expressways, although of course it's no match for spotting the big, dark head of the Willis Tower from many miles out.
For such an enormous building, it touches the ground beautifully, with a multi-level plaza that steps down to the river and two levels of walkways that run along the river inside the building's monumental stainless-steel-clad columns without actually being inside. Add to that a black-bottomed lily pond in the plaza, and it's a nice addition to the streetscape just off Michigan Avenue.
And inside the 2.6 million-square-foot building, there's the well-reviewed restaurant, Sixteen, and bars, Rebar and the Terrace at Trump. I haven't been to any of them, so feel free to add your thoughts.
But let's start at the beginning. The site on Wabash was previously occupied by the Chicago Sun-Times building, a seven-story building finished in 1958 that was looking pretty tired by the time the Sun-Times parent company, Hollinger International, moved the newspaper out and sold the site to Trump in October 2004 for $73 million. Demolition started less than two weeks later, and construction started in March 2005.
It had already been four years since Trump had unveiled his first plans for the site: the world's tallest building, about 1,500 feet tall, or about 145 stories. That was in July 2001, two months before the 9/11 attacks made supertall buildings suddenly very frightening. The proposed height was cut to 1,075 feet and 78 stories. And it was going to be a mix of offices and residential.
What was ultimately built is 98 stories (95 from the sidewalk level, but those lower three really do count, as is obvious when you stand in the riverfront plaza, three stories down from the sidewalk. The cost of construction was almost $850 million.
Condo sales started in 2003, with special early deals for the developer's “friends and family” at about $500 a square foot, a 10 percent discount from the standard asking price. Four years later, when condos in the nearly finished building were selling at higher prices than that, the developers cancelled all 40 “friends and family” deals in order to make more money on them. The buyers had to pay more or their contract was cancelled -- Trump didn't back down. Those who bought paid about $50 a square foot more than their original contracts called for.
There's an echo of Trump's primary presidential campaign in the early years of the building. His building and a few other condo highrises were all planned during a building boom for completion dates after what turned out to be an epochal downturn in the real estate market. Trump, the Spire, Waterview and others were all suddenly vying to be the ones that survived and got built. Trump trash talked the Spire, which was planned for a site on Lake Shore Drive just north of the Chicago River, and he turned out to be right: His building got completed and the Spire didn't. Neither did Waterview and several others.
That doesn't mean the building has been a spectacular success. The recession slowed sales of the building's 486 condos, which didn't finish until late 2014, 11 years after they started. The penthouse on the 89th floor sold for $17 million, a little more than half the $32 million asking price. And the two lowest floors of the building are empty, with 70,000 square feet of retail space (more than the size of a typical suburban grocery store) left unfilled nine years after the building opened.
One reason, commercial real estate people say, is that they're two very deep floors, with windows only on one side, along the river. (The other sides are tucked into the site; with windows, they'd primarily look onto other buildings' foundations.) The Trump family at one point hinted at making those spaces into ballrooms, which usually don't have windows, and last summer, the agent representing the space told a Chicago Tribune reporter that a tenant or tenants might be announced in late 2016 or early 2017--in other words, now.
Once Trump's presidential campaign gathered steam in 2015, the building became a target of his opponents' wrath. DNA Info reported that people were posing for selfies where they were giving the finger to the word Trump on the building.
There's also been a persistent rumor this fall that buyers have stopped buying condos there or sellers are selling for low prices just to get out. But I cover residential real estate in my day job, and I can tell you: There's no solid evidence of that yet.
In May -- while Trump's campaign was kicking into high gear -- a one-bedroom unit on the 41st floor sold for $1,127 a foot, the highest per-square-foot price on record for a one-bedroom condo anywhere in Chicago. In September, a unit on the 44th floor sold for $736 a square foot, a 15 percent increase over the same unit's sale in December 2014 at $640 a foot. A unit on the 64th floor sold in December for $973 a foot, up 6 percent from the $917 a foot that it had sold for in 2013. On the 60th floor, a unit went for $734 a foot in September, up 46 percent from its sale in 2013 at $502 a foot.
The point of all those examples is that the data doesn't show a falling away of Trump condo owners, despite what people on the street have told me repeatedly since the election. The number of condos for sale in the building isn't remarkable, either, compared to the numbers in other buildings.