Chicago office conversion targets higher rents with AI data center project

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Chicago office AI conversion

Highlights

Legacy is converting the former Cboe headquarters at 400 S. LaSalle into a 33-megawatt data center, targeting rents up to four times higher than Chicago office averages.
Prime Group and Capri Investment Group purchased the 300,500 square-foot property for $12 million in 2024 and sold it to Legacy in 2025 for $40 million after securing grid upgrades.
Surging power demand in Chicago—expected to reach 95% of substation capacity by 2034—and political constraints may advantage small urban conversions with existing infrastructure over new large-scale data center projects.

Project economics and power capacity

As reported by Bloomberg, the former Cboe Global Markets Inc. headquarters at 400 S. LaSalle Street is being redeveloped into a data center with 33 megawatts of capacity, roughly equal to the average electricity needs of 28,000 homes in the U.S. Legacy expects the project to command rents as much as four times higher than the average downtown Chicago office, highlighting the stronger economics landlords see in computing infrastructure than in conventional workspace.

The 300,500 square-foot building has features that support the conversion, including deep wiring, ceilings reaching 40 feet in some areas, column-free floors and limited windows. Legacy Managing Partner Daniel English says those characteristics, combined with proximity to commercial centers that can reduce latency for AI applications, make the former trading floor well suited for data center use.

The property sat vacant for several years after Cboe moved to another nearby location. Developers Prime Group and Capri Investment Group bought the building in 2024 for $12 million, secured an increase in electricity supply from the local utility, and sold it to Legacy in late 2025 for $40 million.

Urban conversions gain relevance amid grid pressure

The additional power allocation underpins the current 33 megawatt development, and Legacy says it wants to add another 17 megawatts if Commonwealth Edison Co. agrees to provide more capacity. That access is critical because data centers, unlike most residential or commercial buildings, require a large and constant electricity supply.

Power demand is becoming a wider constraint in northern Illinois. By 2034, Chicago's central business district alone is expected to exceed 95% of the current substation network's capacity, and ComEd has recently proposed a $15.3 billion plan to update and operate its grid from 2028 to 2031.

Political resistance to large facilities is also shaping the market. Chicago Mayor Brandon Johnson has joined calls for a moratorium on data center construction over pressure on power grids and water systems, a backdrop that may favor smaller urban office conversions that can move faster because existing power infrastructure is already in place.

Legacy opened a data center earlier this year in a 500,000 square-foot downtown Minneapolis building, underscoring its bet on city-center projects. Even if the AI boom ultimately requires many gigawatts of power, smaller additions in existing buildings are emerging as one path for landlords trying to fill empty offices, although many properties still lack the ceiling height and physical layout typically needed for data center operations.

Our earlier report on AI infrastructure bottlenecks explained how the surge in demand for computing is running into real-world limits in data centers, equipment, labor, permitting, and—most critically—electricity supply. We noted that grid-connection delays and slower additions of generation capacity are stretching project timelines and raising costs, shifting investor attention from AI software upside to execution risks in the physical infrastructure stack.

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