One of Hines T3 (timber, transit, technology) projects is in doubt after the real estate giant put its Goose Island site (in Chicago) up for sale.
As reported by US-based The Real Deal Hines had been working for more than seven years on plans to build a six-storey mass timber commercial tower with the Ciral family, the owners of a historic lumber yard in a gentrified part of Chicago.
Wood Central understands that the 2.1-acre site, located at 1018 West Division Street, a major street in downtown Chicago, stalled after Hines struggled to secure an anchor tenant, which, along with rising construction costs and the long-lasting effects of the pandemic, combined to create a problematic market for commercial development.
“In collaboration with the landowner, we continue to evaluate all opportunities and pursue prospects to develop T3 Goose Island,” said Hines Chicago Managing Director Brian Atkinson.
The pivot comes after Hines, which has over US $93 billion under management, said it wants to use mass timber to de-risk its portfolio, switching from mega steel and concrete projects to build faster, leaner and lighter mid-rise and high-rise buildings.
Hines found that older timber-based buildings consistently kept their tenants, even with poor amenities: “We thought that developing modern timber buildings with amenities could help us tap into a new market of tenants,” Michael Horvath, Hine’s Vice President of Conceptual Construction, told the International Mass Timber Conference in Portland, Oregon, in March.
“From a risk management perspective, this just makes sense,” according to Jonathan Pearce, the Head of Investments, Office, and Life Sciences at Ivanhoé Cambridge (who has been funding select projects): “We would build multi-billion dollar steel projects. The problem with these projects is that we could start a project in 2012, put a shovel in 2017, finish the first stage in 2020, and start the second building that will be finished in 2025.”
To date, Hines has 27 projects (15 in the United States and 12 internationally) completed, in design or under construction – including T3 Collingwood, which was earlier this year crowned the best building in Victoria, Australia.
