History
The hotel and the adjacent Blackstone Theatre were built on the site of Timothy Blackstone's mansion by John and Tracy Drake, sons of his (Blackstone's) former business partner, the hotel magnate John Drake. John and Tracy Drake also developed the Drake Hotel. Their father had been a Director in Blackstone's Chicago and Alton Railroad. At the time of the opening, the hotel and theatre were located at the southern edge of the Chicago Theatre District at Michigan Avenue and Hubbard Court (which was first renamed 7th Street and later Balbo Drive).
The original construction was capitalized at $1.5 million ($25.6 million today), including a $600,000 to $750,000 bond issue by the Drake Hotel Company. In the 1920s, the Drake Hotel Company undertook some financing arrangements which included extending their debt to construct the Drake Hotel. They used the Blackstone Hotel as collateral for one loan in 1927. The Wall Street Crash of 1929 rippled into the hotel industry, leaving the Chicago Title and Trust Company with 30 Chicago hotels in receivership and causing the Drakes to default in 1932. After going into receivership, the hotel closed and was refurbished, but it was reopened in time for the 1933 Century of Progress Exposition.
Read more about this topic: Renaissance Blackstone Hotel
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