Hotel Chicago Owner Shocked by Migrant Housing Plan

Pebblebrook Hotel Trust had no idea that the city was contemplating using its downtown hotel as a potential migrant housing facility.

After Mayor Brandon Johnson revealed he had backed off his plan to use the 354-room Hotel Chicago for such purposes earlier this week, Pebblebrook CFO Ray Martz said the firm has “had no discussions with Mayor (Brandon) Johnson or any city officials about the housing of migrants,” Crain’s reported. 

This revelation comes amid an ongoing struggle to find accommodations for the thousands of migrants who have arrived in recent months. With more than 11,700 individuals currently in city shelters and over 3,300 awaiting placement, Chicago officials are striving to expand its shelter network.

Alderman Brendan Reilly initially informed downtown residents of Hotel Chicago’s potential role as a migrant shelter but later retracted the statement, expressing relief that the idea had been shelved. Reilly claimed to have received the information from a member of the mayor’s leadership team. However, Mayor Johnson’s spokesman denied any plans to use Hotel Chicago for migrant housing and could not explain how Reilly had received such information, the outlet reported.

Council members have voiced concerns about their exclusion from the process of signing contracts for migrant shelters. Some local residents have even filed lawsuits against Johnson and city officials, arguing that properties cannot be converted into migrant housing without proper zoning approval. Officials have cited a disaster proclamation issued by Governor J.B. Pritzker last year as their authority to work around zoning regulations.

In May, Maryland-based Pebblebrook listed the Hotel Chicago for sale, hoping that a bounce-back year for the city’s lodging industry will help land a buyer. The offering is part of the firm’s broader effort to depart from Chicago real estate entirely, as it also listed the 752-room Westin Michigan Avenue Chicago hotel last month, following a sale of the hotel’s ground-floor retail portion.

—Quinn Donoghue