It looked like the Lakeside Press building was a lost cause. Since R.R. Donnelley & Sons parted company with the once-mighty printing plant at 350 E. Cermak Rd. in 1994, the place lay dormant. Plans to convert it into a retail, entertainment and residential center went nowhere.
But the unexpected marriage of 21st Century e-business demands and 1912 printing plant design not only saved the building, but turned it into one of Chicago’s most promising technology centers. Bethesda, Md.-based Core Location LLC purchased the building in August of 1999, and it is now in the final stages of converting it into the Lakeside Technology Center, a “telecom hotel” that will house nearly 1.2 million square feet of networking and telecommunications equipment for a variety of tenants in the telephone and Internet industries.
It turns out that the historic building was practically destined for this fate. Its concrete floors, originally intended to bear the load of massive printing presses, can withstand 250 pounds of pressure per square foot, five times more than typical commercial construction. This makes them suitable for endless rows of floor-to-ceiling computer equipment.
Thanks to close proximity to rail lines, which tend to be popular rights-of-way for fiberoptic cable, the building is well-served with copious bandwidth from companies like AT&T, Qwest, and Global Crossing. And to accommodate the considerable environmental challenges of a building full of spinning hard drives and hot CPUs, just across the street is an enormous chilled water cooling tank, operated by Trigen Energy Corp. of White Plains, N.Y.
Although renovations have been ongoing since August 1999, construction workers inside still pick their way around massive spools of copper, aluminum, and fiberoptic cable. Across one grid of girders that will form the support for a raised platform stand racks of gunmetal-gray cabinets, side by side and eight feet tall, stretching for dozens of feet across the wall. Are they high-power Web servers or advanced Internet telephony gear? No–these are just the backup batteries: The servers haven’t arrived yet.
In addition to the copious backup equipment each tenant will undoubtedly install, Core provides two large power “vaults” fed by four different Commonwealth Edison plants, along with 62 independent power generators.
Chicago deputy commissioner of Planning and Development Jimm Dispensa said that when fully operational, the building will consume 30 percent more power than Sears Tower.
Last year, Sunnyvale Global Center Inc. a subsidiary of Global Crossing Inc., of Sunnyvale, Calif., signed on as Lakeside Technology Center’s first tenant. The company operates Web and e-commerce hosting and service equipment for a variety of Fortune 1000 clients on the East and West coasts as well as England and Australia.
Global Center leased both the third and fourth floors of the building, a total of roughly 260,000 square feet.
Stephen Johnson, vice president of design and development for Global Crossing, said his company will install about 25,000 pieces of networking equipment per 100,000 square feet, and he expects his customers to co-locate roughly the same volume of gear.
It will be difficult to find many people within the mazes of machinery that will ultimately fill the Center’s nine stories. Derby said that in addition to a few dozen building security and management personnel, tenants may staff the mammoth building with just 400 souls–over three shifts.
Progress will not completely trample history at the reborn Center, owing both to its one-of-a-kind styling and protected landmark status. The building’s exterior remains essentially intact, although new walls sit just behind many of the building’s classic (but energy-inefficient) windows, which would let in levels of light and heat unhealthy for hundreds of thousands of network servers.
Inside, the historic lobby remains much as Donnelley left it. Core’s on-site management offices occupy a protected 5,000 square foot zone on the eighth floor.
Not only is all of the intricate woodwork still intact, but yellowing Donnelley mission statements and memorabilia still line some of the office walls.
In addition to spending more than $20 million to buy the property, Core Location pegs its renovation costs at about $100 million, and Core president Michael Jacoby said that tenants would combine to spend more than that sum customizing their spaces and bringing in network equipment.
Thus, the technological luxuries of the Center do not come cheap. Dispensa said that Lakeside’s lease rates were one-third higher than typical commercial office space.
Of course, the reinforced floors, prevalent power, and electrical, fiberoptic and cooling facilities set the center apart from typical buildings. And that helps explain why, as Dispensa said, “This building, by everyone’s account, is the fastest-leased building of this size in the city,” with over 95 percent of space spoken for a year after Core Location closed its purchase.
Since the average lease at Lakeside is 15 years, eager prospective tenants will have to look elsewhere.
The good news is that there are plenty of places to look. “There are no fewer than 25 currently under-utilized buildings within Chicago that can meet the requirements of this type of facility,” said Dispensa. The former Montgomery Ward catalog warehouse at 600 W. Chicago Ave. is also being redeveloped and marketed as e-Port, a competing telecom hotel.
Although the costs of housing equipment in a prime location are considerable, staying within the city has its advantages for telecom hotel tenants.
“[Customers] want to come and touch and feel the equipment, and it’s going to be a very upscale environment for our customers,” said Global Crossing’s Johnson. “And out in the middle of a farm field somewhere is not an easy job to sell.”
Of course, only the most elite e-businesses need a facility as advanced as the Lakeside Technology Center, but it is a powerful symbol of Chicago’s potential to turn a strong industrial past into a promising future.
“The collateral effects of attracting companies to Chicago that need that sort of technological support is immeasurable,” says Pete Scales, spokesman for Chicago’s Department of Planning and Development. “It’s a great magnet for other high-tech companies.”
