Trump Says Big Retail Names Seek Chicago Site

(Read more on the multifamily market.)

CHICAGO-Donald Trump toured the construction of the Trump International Hotel and Tower Thursday and admitted that sales have slowed in the past couple of years. There have already been condominium sales of more than $600 million, Trump said at a press conference on Thursday afternoon.

“The housing market in Chicago is not a very strong market,” Trump said at a press conference Thursday afternoon. While the housing market is strong in New York and Los Angeles, “In Chicago, certainly the market has not been great and that is why we are keeping our pricing at this level.”

The 92-story tower will have a total of 2.6 million sf and will be 1,362 feet tall when completed. It is being touted as the tallest reinforced concrete building in the world. Trump says he originally planned 150 stories, but scaled back the plans after Sept. 11, 2001. He then considered adding a few floors to the building and a spire to make it the tallest building in the US, but 95% of buyers did not want it, Trump says.

The tower will have 339 hotel condominium units with studio, one- and two-bedroom suites with costs ranging from $850,000 to more than $3 million. There are also 486 residential condominium units from studios to five-bedroom penthouses that are priced from $580,000 to more than $9 million. Currently, about 78% of the hotel units are sold and 80% of the residential units are sold, director of sales Tere Proctor told GlobeSt.com.

Most purchasers of the hotel condominium units have been from Chicago, but there have also been some international purchasers, Trump says. “We are really just starting to see international clientele,” he says. The tower will open in phases with the hotel portion to open this December. There has been a lot of interest in weddings, he adds.

Trump says he expects for the hotel to be successful, especially if Chicago is chosen for the site of the 2016 Olympics. If Chicago is chosen, “that is good for hotel people like us and it is good for real estate in Chicago. That would be a great boost for Chicago,” he says.

There will also be 90,000 sf of retail. “I think of all aspects of the building, the thing that we have had the most response on has been the retail,” Trump says, adding he will not name retailers for about six months to a year. “I do not like talking about their names until they sign, but we have many of the biggest names wanting to lease retail space at Trump International,” he says.

Although there is currently a housing slump, Trump expects the tower to be successful in part because he does not think there will be more large condominium developments constructed. “I do not see a lot of things being built in terms of the residential market in Chicago, because I do not think the lenders in Chicago will be there based on the fact that the market is not very good. And, that will take care of demand,” he says.

The Chicago Spire, Trump believes, will not be constructed. “I think it is an impractical building and I do not think that location can get the kind of rents. I think the construction costs will be so high that, unless somebody wants $400 million or $500 million, it cannot be built,” he says.

Now that people are seeing construction progress for the Trump International Hotel and Tower, and can see a portion of the building, there has been an increase of interest for the units, Trump says. “When we first opened and showed the beauty of the renderings and everything else, obviously we sold a tremendous number of units at the early stage. Sales slowed down about a year ago, following the general housing market in Chicago,” he says.

“About a month and a half to two months ago, (there have been) a tremendous numbers of inquiries because they are seeing how beautiful the building is.” Trump says there has been “some sales but an explosion of calls.”

There will be a 1.2-acre park and 1,000 indoor parking spaces. The building will also have 20,000 sf of multifunction and board rooms, a restaurant, grand ballroom with 25-foot ceilings and a spa and health club. The architect for the project is locally based Skidmore, Owings & Merrill.