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Setbacks for two riverfront projects

Shangri-La remains elusive for Waterview

4-Mar-09 – Chicago's North Loop got disappointing news this week on two planned riverfront projects.

Shangri-La Hotels & Resorts has decided not to open a luxury hotel in Waterview Tower, a 90-story project on West Wacker Drive that remains unfinished just short of the 27th floor.

Construction of Waterview Tower was interrupted last year when the Chicago-based developer Teng Real Estate Services was unable to close on a loan commitment of $400 million from China Exim Bank. The bank has put the loan on hold until the U.S. economy improves.

Photo by Steven Dahlman

Last November, Marina City Online reported that the condominium sales staff at Waterview Tower had been laid off, despite selling most of the residential condominium units.

(Left) Waterview Tower as it appeared in November 2008.

Shangri-La Hotel issued a statement on Monday saying it had terminated its contract with the project. “Under the current economic environment, regrettably, the implementation of the hotel project has been suspended with no indication of when activities will resume.”

The hotel chain, based in Hong Kong, opened its first property in North America in January, in Canada.

River Point developer misses deadline for construction financing

Meanwhile, Hines Interests L.P., a developer hoping to build a 52-story tower in the northwest corner of the Loop, missed a March 1 deadline imposed by its prospective anchor tenant to get the money to build River Point Tower.

River Point Tower

There is a 30-day grace period, during which Hines could still arrange financing. Crain’s Chicago Business is reporting that Hines has requested a 90-day extension and both sides are discussing the request. Hines also says it will invest more of its own money in the project, to improve its chances of landing a construction loan estimated at more than $300 million.

(Left) Rendering of River Point Tower.

The investment firm William Blair & Company, LLC needs the tower built before July 2011, when its current lease in the West Loop expires. It was the first tenant to sign a lease with Hines, reportedly for 340,000 square feet, according to Crain’s.