The Habitat Co. has told renters at Kingsbury Plaza in the city's River North area they have to stop smoking in 2011 or move, the Chicago Tribune reported Wednesday.
About 15 percent of the tenants at the 420-unit building are smokers, the management company said.
Once the transition year ends, a first violation of the smoking ban will cost tenants $350. A second violation will result in eviction.
If the transition at Kingsbury is successful, Habitat said it might create a smoke-free environment in its other buildings.
The Chicago Tobacco Prevention Project said a survey completed in November indicated one-third of renters would be willing to pay more to live in a smoke-free building.