108 NORTH STATE STREET

'Block 37 (From State & Washington)'
Viewed from just south of the southeast corner (Washington & State) August 25, 2007

'108 North State Street' will be a mixed use urban center located the Loop community area in downtown Chicago, Illinois. 108 North State Street The 3 building structure is being developed by the Mills Corporation. It will be located on the square block bounded by North State Street, West Randolph Street, West Washington Street and North Dearborn Street that is known as "Block 37." The project broke ground on November 15, 2005. On July 31, 2006, the construction phase began. The retail phase is now slated for completion in Fall 2008.
The Mills Corporation has also been contracted to develop an underground transit center beneath Block 37 that will be jointly funded by the City of Chicago, the Chicago Transit Authority and The Mills Corporation. The planned project includes a new subway station, track connections and a common downtown airport check-in facility for train service to both O'Hare and Midway airports.^[1]
Both Block 37 and The Mills Corporation have histories of financial difficulties. Block 37 had been demolished in 1989 for a redevelopment plan under the then new Chicago Mayor Richard M. Daley. The plan fell through as did several subsequent plans leaving the block vacant and undeveloped for nearly a generation. The Mills corporation has itself been in financial difficulty in the past. This reputation and changing financial climate caused a delay in 2006 as contractors feared not getting paid.

Contents

Details

Progress

Phase I Construction

Phase II Construction

You Are Beautiful

History

Block 37

The Mills Corporation

Corporate Difficulties

Block 37 Troubles

Notes

Gallery

External links

Details

According to proposed plans, it will be composed of three united structures: a 21-story residential condominium tower called 108 North State Condominium Tower at North State Street and West Randolph Street, a 20-story hotel tower called 108 North State Hotel Tower at West Randolph Street and North Dearborn street, and a 17-story tower called CBS 2 Broadcast Center at North State Street and West Washington Street.^[2] There is talk that the hotel tower has been abandoned in favor of a second residential tower. These structures will rise above lower level retail space. It is expected to have a very eclectic mix of shopping, entertainment, and dining in its lower retail floors. Below street level, there will be a CTA transit station providing express service to O’Hare and Midway airports via the "L," as well as local connections via the CTA Blue and Red line subways (replacing the Washington/Dearborn and Washington/State stations, respectively).
Architecturally, the main floor will feature transparent cornered project fascades and clear glass street level views. The multiple structures will feature approximately 400,000 square feet (40,000 m²) of retail, entertainment and dining space; 200,000 to 450,000 square feet (42,000 m²) of office space; a 200- to 300-room hotel; a 200- to 300-unit residential tower; and a state-of-the-art CTA transit station providing service to and from Chicago’s O’Hare and Midway airports. The Mills Corporation Breaks Ground On 108 N. State Street Project Sullivan, Rebecca
It will be flanked to the west by the Richard J. Daley Center and to the east by the flagship Macy's State Street department store. It is part of the central business district that includes Chicago City Hall and the James R. Thompson Center within 2 blocks.

Progress

Phase I Construction

22 West Washington is the first of the three buildings (photo August 25, 2007)

The Mills corporation purchased the property for the project from the city on November 11, 2005. Phase I of the project, the groundbreaking, began formally on November 15, 2005. This followed winning the competition to be master developer and having their plan approved by the city. The Mills corporation has also have listed letters of intent from CBS 2 Chicago Broadcast Center, Boggi Milano, Sisley, Andrew’s Ties, Banana Republic, Rosa Mexicano, David Barton Gym and new concepts by Steve Lombardo, creator of Gibson's Steakhouse and Hugo’s Frog Bar, and Steven Foster, creator of Lucky Strike Lanes in Hollywood as future tenant commitments. Morningstar, Inc. has signed a lease to occupy about 210,000 square feet (20,000 m²) across eight floors, making it the largest tenant in the office tower. Morningstar finalizes 15-year lease for Block 37 In April 2005, Mills had announced a lease commitment with WBBM-Channel 2 for about 100,000 square feet (10,000 m²) of space for offices and a showcase television studio. As of August 2007, Zara was negotiating for a location at Block 37.^[3]

Phase II Construction

Condominium Tower construction beginnings on May 2 2007.

On July 31, 2006, the retail and CTA construction began. The retail portion entails the construction of the CBS 2 Broadcast Center building at North State Street and West Washington Street. The Mills Corporation Begins Construction Of Retail, CTA Portions Of 108 North State Street Project LaVelle, Avis and David Douglass The building will also serve as the corporate headquarters of Morningstar, Inc. This 17 story building will be 276 feet in height (84 m). CBS 2 Broadcast Center After a series of previous failures on this project, this marks the first time redevelopment has gone past ground breaking to the construction phase. The construction of the condominium Tower at State Street and Randolph was visible on May 2 2007.
The first phase of construction (Phase II) had been contracted to be completed by March 2008. Block 37 deal on the ropes — again This would enable Morningstar, Inc. to move before its early 2009 lease expiration at its present location, 225 W. Wacker Drive. However, financial troubles have caused delays that have necessitated that Morningstar who had intended to occupy over half of the building seek lease proposals from other downtown office towers. Morningstar would suffer holdover penalties and other damages if it were unable to move before its lease expires. Morningstar is hesitant to pursue other opportunities because their lease at 108 North State Street is at a below market price in the low $20s/square foot.

You Are Beautiful

On the pedistrian walkway next to the construction site, an artist has constructed a series of cutout woodblocks that all say the message "You Are Beautiful" in several languages.

History

Block 37

Block 37 was one of the city's original 58 blocks,^[4] and there was much consternation when it was demolished in 1989, after Mayor Richard M. Daley approved its demolition to erect a multi-use skyscraper with retail, hotel, office, and residential spaces. Due to Block 37's central location in the downtown loop, its history is a microcosm of the city's history.^[5] Block 37 was a nearly vacant city block from 1989 until 2005 after several attempts at redevelopment failed due to Chicago politics and insufficient funding of several past developers.^[6] The single remaining building from the 1989 Block 37 architecture is an active Commonwealth Edison transformer building that distributes power to a great portion of the Loop.
The complex is being developed by commercial real estate developer Mills Corporation, best known for its ownership of numerous super-regional shopping malls. Among the prior redevelopment plans were the original Block 37 Towers, for which the original block was demolished and which included a 47-story tower designed by Murphy/Jahn, Inc. Block 37 Tower I Another failed plan was a Solomon Cordwell Buenz plan including a 711 foot 66-story residential tower and a 12-story Marriott Hotel towering over a 4 story retail base. A Weekly Dose of Architecture ^[7] This had followed the 39-story Kohn Pedersen Fox Associates design scheduled for 2004 completion.^[8]

The Mills Corporation

Corporate Difficulties

Mills' troubles began in November 2005, with revelations of large losses on failed projects, a cash crunch and a U.S. Securities and Exchange Commission investigation into its accounting. The SEC inquiry was upgraded to a formal investigation in March 2006. Mills Corp. Now Target Of Formal SEC Probe The reclassification as a formal investigation allows for the use of additional techniques such as subpoenas. On April 6, 2007 Simon Property Group, Inc. announced the joint acquisition of Mills Corporation along with Farallon Capital Management, L.L.C. for $25.25 per share of common stock.^[9]

Block 37 Troubles

In March 2006, contractors halted construction because of fears that they will not be paid. This caused Morningstar to reconsider their lease commitment. As a result, the value of the project declined, which made the resale of the project rights difficult. Mills was close to a deal with German investment firm, Deutsche Immobilien Fonds A.G. prior to the difficulties. DIFA had outbid Chicago developer Golub & Co., which then became the frontrunner. Golub, an international real estate investment company headquartered in Chicago, has closed on the office space portion of the project. Golub sues Mills on Block 37 Corfman, Thomas A. and Eddie Baeb Mills eventually sold the retail space rights to Chicago developer Joseph Freed & Associates, who had previously purchased the nearby Carson, Pirie, Scott and Company Building (located at 1 South State Street) that closed in early 2007.^[10]
Golub and Mills are now in a legal entanglement over certain leases to Morningstar for 211,000 square feet (19,600 m²). Golub claims Mills new the measurments of the floors actually totalled 23,700 square feet (2,202 m²) although they contracted for 211,000 square feet (19,600 m²). Golub claims a Morningstar affiliate "...induced Morningstar to agree in the lease to be bound by an after-the-fact re-measurement of the space." Additionally, Golub claims that Mills has acted without Daley administration authorizations for plans such as elimination of a proposed hotel in favor of a 2nd apartment tower, as required by an agreement between Golub and Mills. In addition, Golub has sued over the residential portion of the project, which was given to Freed. Golub claims to have accepted the office space part of the project at a low profit with the expectation of making a larger profit on the residential portion.^[11] However, a court ruling has paved the way for Mills to terminate its contract with Chicago-based Golub & Co. to develop the project’s two residential towers and to sell the residential portion of the Block 37 project in the Loop to developer Joseph A. Freed & Associates LLC.^[12]

Notes

1. CTA Reaches Agreement for Development of Block 37
2. 108 North State
3. Fashion shops Mag Mile
4. Thompson's Plat of 1830
5. Block 37 Miller, Ross
6. News: Chicago’s Block 37 back on the block Finnegan, Tom
7. News: New design announced for Block 37 Gerometta, Marshall
8. Block 37 Development
9. Simon Property Group and Farallon Capital Management Complete Acquisition of The Mills Corporation
10. Mills sells interest in Block 37
11. Golub sues to stop alleged new Freed deal on Block 37
12. Ruling paves way for sale of Block 37 residential to Freed

Gallery

Viewed from the northwest corner (Dearborn & Lake) April 12, 2007

Viewed from the southeast corner (Washington & State) April 12, 2007

January 31, 2007

December 13, 2006

December 13, 2006 viewed from Richard J. Daley Center In Background:(Macy's Flagship @ State Street)

November 21, 2006 progress Southwest corner progress.

External links

★ Official Website

★ Blown up projected view

★ Pictorial block 37 information

★ block 37 constuction webcam