CHICAGO—The AFL-CIO Housing Investment Trust has just decided to funnel $32 million of pension capital funding towards the rehabilitation of 2101 South Michigan, a 26-story residential tower on Chicago's Near South Side. The goal, trust officials say, is to help preserve affordable housing options near Chicago's downtown as new development floods the area.

Built in 1971 with financial assistance from the Federal Housing Administration's grant program for affordable housing, the 250-unit property needs major upgrades to improve its energy efficiency. The $42 million renovation project will also provide a new lobby, community room, and on-site laundry facility as well as energy-efficient appliances and new heating and cooling in the individual units.

"As older downtown neighborhoods experience growth with the corresponding demand for housing, it's very important to preserve and update existing units whenever possible," says HIT Executive Vice President and Chief Investment Officer Stephanie H. Wiggins. "The HIT's investment in 2101 South Michigan will help ensure that quality housing near Chicago's downtown Loop, with its employment opportunities and other amenities, remains available to individuals and families at all income levels."