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LINCOLN PARK — A plan to devote city funds toward rehabbing a single-room occupancy building into permanent supportive housing in Lincoln Park is scheduled for a City Council vote Wednesday.
The council’s Committee on Finance signed off on an agreement Thursday for the city to provide up to $5 million in multifamily loan funds and up to $12 million in tax-exempt bonds toward nonprofit NHP Foundation’s $21 million project to rehab the Covent Hotel, 2653 N. Clark St.
The Covent Hotel dates to 1915, when it was built to accompany an adjacent theater, which was demolished in the 1960s. The surviving three-story building has long served as a single-room occupancy, but it fell into disrepair after its previous owner died, city officials said.
Credit: Screenshot/City of ChicagoThe proposed rehab involves converting the hotel’s 64 rooms into 30 larger studio units with their own kitchens and bathrooms, city officials said. All the units will be permanent supportive housing restricted to tenants at or below 30 percent and 50 percent of the area median income.
Ald. Michele Smith (43rd), who has supported the project since before it went to the city’s Plan Commission in 2020, said it was a “very difficult project to bring to fruition because of the high cost in our community.”
The area median income in Lincoln Park is just under $100,000, city officials said.
“It was very important to me and the surrounding community that we preserve this [single-room occupancy], which has been used in this fashion since just past the Depression,” Smith said. “We couldn’t be happier.”
Credit: Brininstool + Lynch/City of ChicagoThe hotel’s renovation will also involve replacing doors, windows and elevator systems, as well as converting its eight ground-level commercial spaces into four larger retail spaces, said Mecky Adnani, senior vice president at NHP.
“This is what the community wanted,” Adnani said. “These kinds of rental units are needed in the Lincoln Park area, and we’re really glad we could preserve the building while creating these 30 great studio apartments.”
Currently, the Covent Hotel has tenants in 20 of its units. They will be offered priority to return to the renovated studio units once the rehab is finished, Adnani said.
Under the Uniform Relocation Act, NHP will have a relocation plan and a relocation specialist on board to find units nearby the Covent for its current tenants to stay in while the rehab is happening, Adnani said.
The Chicago Housing Authority has also approved 30 project-based vouchers for the Covent’s incoming residents, including its current tenants, Adnani said. The vouchers allow residents to pay 30 percent of their income for rent.
“So we expect some residents to actually have a reduction from the rents they are currently paying,” Adnani said. “The project-based subsidy protects the residents as the rent is based on their income, not the market.”
“We don’t displace anybody, so they come back to brand new, semi-furnished units in Lincoln Park that are going to be beautiful,” Adnani said.
The Covent Hotel’s renovation is part of a planned development that involves building a modern seven-story building designed by architecture firm Brininstool + Lynch in the parking lot east of the historical building. Adnani said the developer’s purchase of the parking lot will help finance the Covent’s rehab.
Although the new structure calls for 84 rental units, only two will be offered at an affordable rate. To satisfy the city’s Affordable Requirements Ordinance, the developers will pay the city $794,000 to cover the shortfall of on-site, low-cost units.
That money will go directly toward the funding renovation of the old Covent building, Adnani said.
Other funding includes the 4 percent tax credit equity generated from the city’s bonds, a first mortgage, an FHA insured first mortgage loan, a loan from the Illinois Housing Development Authority Trust Fund, a grant from ComEd and equity generated from historic tax credits, according to a news release from the city’s Housing Department.
“Everybody has come together from the time we purchased this building in 2016, and everybody’s excited and supportive of it,” Adnani said. “It’s been a true collaboration.”
Jake Wittich is a Report for America corps member covering Lakeview, Lincoln Park and LGBTQ communities across the city for Block Club Chicago.
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