Construction Loan Monitoring for New Hotel at Chicago’s McCormick Place
McCormick Place, the nation’s largest convention center, brings in nearly 3 million visitors each year. Many of these visitors attend conferences that extend over several days or weeks. To meet the needs of long-term visitors, Hilton, along with First Hospitality Group, proposed a new extended stay hotel development adjacent to the convention center. The proposed hotel development would be tri-branded (Hilton Garden Inn, Hampton Inn by Hilton, and Home2 Suites by Hilton) and would include various hospitality amenities, a rooftop restaurant, and first-floor retail spaces. Additionally, the proposed development would have direct access to the convention center with an attached third-floor pedestrian walkway.
The new hotel development was designed as a twenty-three-story structure and was constructed from the ground up over a two-year period. The project commenced with a deep foundation system and continued with a consecutive sequence of concrete pours for the pre-stressed concrete vertical superstructure. With more than a dozen trades on site each day, project management became an essential aspect to the construction progress.
As one of the primary lenders on the construction loan for the hotel development, CIBC relied heavily on the project’s scheduling commitments. Monthly disbursements of the construction loan necessitate detailed inspections confirming the completion of specific trades and project milestones.
AKT Peerless utilized our extensive background in construction and cumulative cost data to perform a preliminary review of the project prior to loan closing. The initial review helped pinpoint any major factors that could potentially impact the original proposed budget or schedule throughout the duration of the project.
AKT Peerless’ presence at monthly pay application review meetings provided regular insight into any design or scheduling changes to the project. The information at the meetings was regularly communicated to CIBC so they can carefully manage any financial risks throughout the various stages of construction.
- Protection from liability exposure during the initial review of the construction documents.
- Recommendations for budgetary contingencies to account for unforeseen conditions.
- Recurring updates on any potential risks or modifications to the construction design throughout the construction.
- Assurance that the monthly disbursements of loan funds were not premature but were consistent with the appropriate project milestones.