Although they lack an an anchor tenant, Canadian developer Ivanhoe Cambridge and co-investor and developer Hines broke ground Tuesday on a 45-story office tower in Chicago's West Loop, the largest commercial project to rise in the city in five years.
Named River Point, the $300-million project will add 850,000 square feet to Chicago's financial district when completed in 2016. It also will add a 1.5-acre park and plaza to the city's riverfront, where the project is sited.
“This is a momentous day for the City of Chicago,” said Mayor Rahm Emanuel, who attended the groundbreaking. “River Point is an example of smart growth and job creation for our city, and I am proud there is enough confidence in the city’s economic landscape for this project to come to fruition.”
“We are moving ahead because we see a growing economy in Chicago and the demand for this type of high-caliber office space is growing rapidly,” Ivanhoe Cambridge spokesperson Sebastien Théberge indicated in a statement to reporters. “This building will be attractive to the firms that are expanding or relocating to the city. There is a lot of interest and we are making good progress with a number of potential tenants.”
In May, the real estate wing of Quebec pension fund manager Caisse de dépôt et placement du Québec announced it was backing River Point through a partnership with Hines.
After a year and a half of declines, Chicago's downtown office vacancy rate remained unchanged at 14.8% during the third quarter, but down from 15.8% a year earlier, according to Los Angeles-based CBRE Inc.