A Chicago investor’s plan to convert part of a landmark Loop office building into a data center received its first city approval last week, a move Chicago’s leading preservationist group called “a dangerous precedent.”
Igor Gabal is pitching the conversion of floors two through six of 300 W. Adams St. into a data center, with a new ComEd vault to power it. Ten backup generators would also be installed on the building’s roof.
The Commission on Chicago Landmarks’ Permit Review Committee approved the project on Aug. 6, though the full commission still has to green light the plan.
An affiliate of Gabal purchased 300 W. Adams St. for $4 million in 2023, property records show. Gabal said during the meeting that he’s tried to find new tenants but “no one wants to lease space” in Class C buildings like the Adams Street property, especially amid a period when office vacancy rates remain elevated following the pandemic. Instead, tenants are flocking to Class A buildings, which boast modern finishes and amenities like gyms and coffee shops.
The 1927 building was nearly 60% vacant as of 2023, according to the Permit Review Committee.
Gabal didn’t respond to a request for comment.
If approved, his plans to consolidate existing office tenants into the building’s upper floors, in addition to infilling the light court on floors three through five. The ComEd vault would replace a retail space on the ground floor, with three additional retail spaces remaining available. Gabal’s team said the first floor is the only space where the vault could fit, given its size and proximity to incoming power.
He said the vault would be no more than 50 megawatts — considerably less than large hyperscale data centers, whose energy use can go up to hundreds of megawatts. The building’s brochure advertises the “new medium-voltage vault” as 20.4 megawatts.
Committee staff said during last week’s meeting that Ald. Brendan Reilly (42nd) reviewed the proposal and had no objections. They also acknowledged that, despite rising and “valid” concerns over data centers, their purview is solely from the perspective of historic buildings.
With a few tweaks to Gabal’s plan — including setting data center equipment 3 feet away from all historic windows — staff said the project fit the guidelines for altering historic buildings.
Data centers have drawn fire in Chicago and across the country because of their potential to negatively affect the environment, drain water supplies and drive up energy costs. Mayor Brandon Johnson cited those impacts Tuesday when he signed an executive order establishing regulatory guardrails strengthening the city’s approach toward data center development. He also called for a moratorium on new or expanded data centers within city limits until permanent regulations are established.
There are currently 39 data centers in Chicago, according to the mayor’s office.
The city’s Department of Planning and Development confirmed Thursday that since data center use is allowed under the building’s current zoning, the proposal isn’t subject to the new cross-department review that Johnson instituted in his executive order. The new review process includes an assessment of electricity demand, water use, generator impacts on noise and pollution, air emissions, cumulative environmental burdens and neighborhood effects.
Gabal told committee members there’s no industry other than data centers that can support the work needed to transform the nearly 100-year-old building. Repairs on the building’s terra cotta and “significant reinvestment” toward the building’s aging interiors are needed.
The cost of the project is unclear, but Gabal told the committee his team isn’t requesting city funding for the project. “I think it’s a win-win for everybody,” Gabal said.
Preservation Chicago was supportive of the building’s landmarking in 2009, which recognized the site as a symbol of the Loop’s transformation from industrial to office use.
But allowing the data center conversion could set a “dangerous precedent” that leads to other landmark buildings being converted to industrial use, Ward Miller, executive director of Preservation Chicago, said in the meeting.
He called for more creativity in how the office building finds its second life during a time when Chicago desperately needs more housing — especially affordable units.
“Preservation Chicago feels that a historic and Chicago landmark building should be adaptively used in other ways, specifically for residential reuse and not for a conversion of a Loop office building across the street from the Sears Tower, in the heart of the financial district,” Miller said.