The $85 million conversion of the former Chicago Athletic Association building into a hotel would be supported by a property tax incentive introduced today to City Council by Mayor Rahm Emanuel.

CAA Hotel Owner LLC, which purchased the vacant building last year, would use the Class L property tax incentive to rehabilitate the property into an approximately 240-room hotel. With entrances at 12 S. Michigan and 71 E. Madison St., the building is located within the Historic Michigan Boulevard District.

The Class L incentive, which encourages the preservation and rehabilitation of landmark properties, would lower the cost of property taxes over a 12-year period by an estimated $5.7 million.

Plans call for masonry repairs, window replacement, new storefronts and a new rooftop addition. Interior work would include structural modifications, new elevators and the addition of new mechanical systems.

The 11-story portion facing Michigan Avenue, completed in 1893, was designed in the Venetian Gothic style by architect Henry Ives Cobb.  The 19-story annex on Madison Street was designed by Richard E. Smith Jr. in the Prairie style and completed in two phases in 1906 and 1926.

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