When completed, the building will extend from 1600 to 1626 N. Milwaukee Ave.
Jessica Minton, manager of Convexity Properties for DRW Trading Group, said there will be two segregated operations within the renovation. Minton added that one part of the building will be a hotel with 75 rooms and the other will be used as a hostel with 20 rooms.
The hostel will mimic a dorm-style, shared-living layout to accommodate traveling families, said Minton. Rooms will have between four to six beds to house multiple guests.
In 2008, the Chicago Zoning Board approved plans to convert the building into a hotel, but financial difficulties delayed the project, according to Crain’s. Developer Don Wilson and AJ Capital purchased the tower last year for $12.5 million, Crain’s reported. Wilson and AJ Capital own the property management firm DRW Traders, which is managed by Convexity Partners.
But the current owner of record is 1600 North Milwaukee Ventures LLC, said Minton.
The developers have been meeting with Ald. Scott Waguespack (32nd) and taking all necessary steps “to get the ball rolling” and launch the project, Minton said.
The Northwest Tower contains 36 to 37 rental spaces for small business tenants. Tenants are scheduled to move out by January.
According to dnainfo.com, the 37,000-square foot tower will have rooms ranging from $130 to $170 per night and around 300 square feet each.
“We wanted to create a great product but make it affordable so it would attract a whole demographic,” said Minton. “With it being right near the train, it makes it convenient for people needing to get to and from the airport.”
According to Convexity’s Evan Meister, real estate analyst, Convexity Properties and DRW are working with the Illinois Historic Preservation Agency, which oversees the rehabilitation of landmark buildings.
The Northwest Tower is not a landmark building, but it is located in the Milwaukee Avenue district, which is a landmark district.
Because of its location, the developers are seeking federal tax credits, Meister said.
Convexity Properties and DRW Trading were required to go through the building’s process of foreclosure to gain acquisition of the Northwest Tower.
“We are going to pursue the federal history tax credits as well as Cook County incentives,” said Meister.
Built in 1929, the tower was one of the first skyscrapers outside of downtown Chicago. According to Wikipedia, the skyscraper was originally built for lawyers, doctors and other professionals.
“We are going to renovate the facade but leave it as you see it,” said Minton.
According to Minton, the neighborhood is looking forward to the completed renovation.
“We are restoring the original lobby, building a rooftop enclosure and we will have to replace and modernize the elevators,” said Meister.
Sprint Communications is the tenant on the first floor of the Northwest Tower. Sprint still has a lease open. But, if a different location can be found for the business, the first floor of the tower will become a diner, according to Meister.
“On the second floor we are hoping to build a little café and lounge with some space to host private events,” said Meister.
The developer is renovating the building in an effort to offer accommodations to out-of-town visitors in a neighborhood outside the Loop, Minton said.
“The building has been somewhat of an eyesore in the neighborhood for sometime,” said Minton. “We have met with pretty much all of the neighborhood groups and gotten pretty involved with the Wicker Park and Bucktown Chamber of Commerce.”
“I would love to see the transformation of the Northwest Tower into a hotel/hostel combination; it would be great,” said Genevieve DeVille of Buffalo Exchange trading store. “This is my second year working in Wicker Park, and there are always a lot of people visiting.”
DRW Trading Group has a history of successfully renovating buildings in the Wicker Park area. The company updated the historic Noel State Bank Building at 1601 N. Milwaukee Ave., which has housed Walgreens since March 2012.