Santander Bank, Washington Capital Provide $113M Debt for Chicago Office Conversion

Commonwealth Development Partners and Triangle Capital Group have secured $113 million to finance the conversion of an empty 25-story office building at 500 North Michigan Avenue into 384 mixed-income rental apartments in downtown Chicago. 

Santander Bank provided $71.5 million of non-recourse construction debt, while Washington Capital Management provided $41.5 million of joint venture equity. JLL Capital Markets’ Chris Knight, Ryan Planek and Annie Thomas arranged the transaction.

Crain’s Chicago Business first reported the deal. 

As the building will retain its vintage 1960s-era architecture, the project aims to secure Federal Historic Tax Credits, while also securing tax benefits from the Illinois Affordable Housing Special Assessment Program. 

Washington Capital Management’s Robin Dean called the joint venture of Commonwealth Development Partners and Triangle Capital Group “an experienced sponsorship team,” and described 500 North Michigan Avenue as “an irreplaceable location and a thoughtful adaptive reuse strategy.” 

“We believe [the asset] is well positioned to meet long-term demand for high-quality housing in downtown Chicago,” she added.   

Commonwealth Development Partners and Triangle Capital Group acquired the vacant office building for only $5 million last August. In April, Washington Capital Management purchased 21,565 square feet of retail space connected to the ground floor of the building for $41 million from Commonwealth Development Partners. 

Located in the heart of the Chicago Loop along the famous “Magnificent Mile” in the city’s Streeterville neighborhood — which includes Northwestern Memorial Hospital, Lurie Children’s Hospital and the University of Chicago Booth School of Business — 500 North Michigan Avenue will deliver more than 250,000 square feet of rentable apartment space to the downtown area. The project will feature 320 market-rate units, while 64 units will be zoned for affordable housing. 

The asset will also include 60 on-site parking spaces and feature amenities such as a rooftop pool, a fitness center, coworking spaces, a theater, and ground-floor retail. 

Construction on the conversion began in May 2026 and is expected to finish in March 2028.  

“With a world class address in the heart of Chicago’s ‘Eds and Meds’ neighborhood, the project is well positioned to take advantage of Chicago’s nation leading rent growth,” said Commonwealth’s Matthew Faris, who noted that Chicago’s multifamily assets have jumped 6.5 percent year-over-year. 

Brian Pascus can be reached at bpascus@commercialobserver.com.