500 N. Michigan redevelopment advances with 320 apartments and 64 affordable homes

A major Streeterville conversion is now under construction

Chicago’s 500 N. Michigan Avenue is moving from approved redevelopment plan to active construction, bringing a new residential use to the upper portions of a prominent Streeterville office tower. Commonwealth Development Partners and Triangle Capital Group are converting the property into 320 apartments, including 64 affordable homes, while retaining retail space at the base of the building.

The project gives nearby residents and businesses a concrete example of how an existing downtown structure can be repositioned without demolishing the tower and replacing it with an entirely new building. The 42nd Ward’s project page identifies the proposal as a conversion of existing office space into 320 dwelling units, lists the neighborhood as Streeterville and records both Chicago Plan Commission approval in October 2024 and a July 2026 groundbreaking. The 42nd Ward project record also says the building’s planned height will increase to 322 feet and that 68 valet accessory parking spaces and a loading berth are part of the plan.

The latest financing and construction details were reported as of September 2026. REBusinessOnline reported that construction began in May and is scheduled for completion in spring 2028. Multifamily & Affordable Housing Business reported the project had broken ground on a $162 million redevelopment.

How the apartment plan is structured

The 25-story building was acquired by Commonwealth Development and Triangle Capital Group in August 2025 for $5 million, according to REBusinessOnline. The partners are now using a combination of construction debt and equity to fund the adaptive-reuse work.

The financing package totals approximately $113 million. It includes a $71.5 million nonrecourse construction loan from Santander Bank and $41.8 million in joint-venture equity from Washington Capital Management on behalf of an institutional client. JLL arranged both components for Commonwealth, according to the financing report.

The apartment mix is intended to include studios, one-bedroom units and two-bedroom units. The affordable homes represent 20% of the planned 320-unit community, and Multifamily & Affordable Housing Business reported that rents for those units will be restricted to households earning between 40% and 80% of area median income. The report also identifies GREC as the architect.

Planned features reported by the project coverage include:

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• 320 total apartments, with 64 designated as affordable
• Ground-floor retail and onsite parking
• A rooftop pool and amenity deck
• Fitness, coworking, theater and concierge spaces

The project is not a complete replacement of every existing use. The financing report says residents will have access to ground-floor retail, and the 42nd Ward description identifies valet parking rather than self-parking. Those details matter for the surrounding blocks because the conversion is being layered into an active mixed-use setting rather than creating a residential-only site.

Why the building is being reused

Office-to-residential conversions are highly dependent on the physical layout of an existing building, the cost of reworking interiors and the ability to assemble financing for a complex construction program. Here, the project combines a central Michigan Avenue location with a large existing structure and a plan that preserves some commercial activity.

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The reported $162 million redevelopment budget is substantially larger than the partners’ $5 million acquisition price. That contrast underscores the scale of the work involved: the purchase is only one part of the investment, while the conversion requires residential layouts, building-system changes, common amenities, accessibility work and other construction needed to support apartment occupancy. The sources describe the project as adaptive reuse, but they do not establish a final construction-cost breakdown, so individual line items should not be assumed.

For prospective renters, the most important future information will be the eventual leasing schedule, apartment pricing, income limits and application process for the 64 affordable homes. None of those public-facing leasing details were included in the project and financing reports reviewed for this article.

What to watch before completion

The current schedule points to spring 2028 in REBusinessOnline’s account, while Multifamily & Affordable Housing Business gives a more specific March 2028 target. That date remains a development target rather than a guarantee of occupancy. The next visible milestones will be the progress of interior construction, the delivery of the rooftop and shared amenities, and the release of leasing information.

Because the project involves a building conversion, zoning and construction jurisdiction should be verified from the property and project records rather than inferred from a mailing address. A ZIP code or postal city alone is not authoritative for determining jurisdiction. Separate fire, health/septic/well, or road/right-of-way permits may apply in addition to a building permit; readers can use the Illinois permit finder to confirm the correct permit authority.

For Chicago’s housing market, 500 N. Michigan Avenue will be watched as a test of whether a large office property can support a meaningful number of new homes while retaining retail and other urban functions. For Streeterville, the near-term story is more specific: an approved plan has secured financing, work has begun and a vacant or underused office configuration is being rebuilt around a 320-home residential program.