The Real Deal Chicago

Chicago’s top 10 investment sales in Q2

Brookfield’s acquisition of 175 West Jackson Blvd tops the list at $305M
July 16, 2018 01:30PM

175 W Jackson Blvd, Wrigley Building, North Harbor Tower, Optima Tower (Credit: HarshLight via Flickr, Optima)

A pair of high-profile downtown office behemoths took the top two spots of Chicago’s 10 largest investment sales in the second quarter of 2018. Together, the deals add up to more than $1 billion.

The office deals were led by Brookfield Asset Management’s acquisition of the 22-story building at 175 West Jackson Boulevard building. That $305 million deal made it No. 1 for the month.

But overall, residential properties dominated the top 10 list, including the 600-unit North Harbor Tower complex and the 325-unit Optima Chicago Center.

All the numbers were compiled from Cook County property records

1. 175 West Jackson Boulevard | $305 million

Brookfield Asset Management paid $305 million to a venture that included Extell Development for the 1.45-million-square-foot Daniel Burnham-designed office building at 175 West Jackson. The 22-story tower includes 46,000 square feet of retail space and remains about 33 percent vacant, with tenants including technology company Enova International and Wolverine Asset Management.

2. Wrigley Building, 410 North Michigan Avenue | $255 million

The neo-gothic tower sold to billionaire Joe Mansueto, handing over a freshly-renovated Chicago icon whose more than 450,000 square feet of office space is almost 95 percent leased. A group of investors including BDT Capital Partners, Zeller Realty and Groupon co-founders Eric Lefkofsky and Brad Keywell bought the building in 2011 for $33 million, subsequently paying more than $90 million for updates including a sweeping new retail plaza that now houses a 32,000-square-foot Walgreens store.

3. North Harbor Tower, 175 North Harbor Drive | $240 million

Waterton did not disclose how much it paid for the 600-unit North Harbor Tower, but property tax records indicate the Chicago-based developer bought it for $240 million. The seller, Crescent Heights, had acquired it for $237 million two years ago. The 55-story tower was the largest of three apartment high-rises sold off by Crescent Heights, as the Miami-based developer continues work on NEMA Chicago, formerly known as One Grant Park.

4. Optima Chicago Center, 200 East Illinois Street | $155 million

The buyer Edge Principal Advisers, acquired the Optima Chicago from Bartolo Development, which had employed architect David Hovey to design the 42-story tower a few years before. Bartolo acquired the land in 2008 for $20 million. The 325-unit residential complex was completed in 2013 with 22,500 square feet of ground-floor retail space, and four years later the 57-story Optima Signature opened next door.

5. President’s Plaza I & II, 8600-8700 West Bryn Mawr Avenue | $147 million

Angelo, Gordon & Co bought the pair of office mid-rise buildings from partners Glenstar and Prudential, which had paid about $129 million for the property in 2006. The joint venture then spent around $15 million on renovations, starting in 2016. Glenstar will retain a minority stake in the 835,000-square-foot complex and will continue to help manage the property. The building is about 92 percent occupied, with tenants including American Imaging Management, Lafarge and True Value.

6. Park Michigan, 1212 South Michigan Avenue | $92.5 million

The 30-story South Loop tower was another piece of Crescent Heights’ downtown apartment offload, this time selling to the Chicago-based Horizon Realty Group. The seller had paid $65 million for the building in 2011. The building’s 344 apartments and 12,000 square feet of street-level retail are about 92 percent occupied.

7. The James Hotel Chicago, 55 East Ontario Street | $83.1 million

Denihan Hospitality had paid nearly $137 million for the 297-key James Hotel at the height of the 2008 real estate bubble. The June sale tallied a roughly 40 percent loss for the firm when a joint venture of Junius Real Estate Partners and 21C Museum Hotels bought the 16-story building. The hotel’s revenues had fallen sharply between 2014 and 2016, leaving Denihan with more than $80 million in debt on the property.

8. Kennelly Square, 1749 North Wells Street | $78 million

With $78 million, Strategic Partners of North America set the record for priciest condo deconversion in the Chicago’s history when it bought the 268-unit Lincoln Park tower from the Kennelly Square Condo Association. It tops a growing list of condo deconversions all over the city, as growth in the rental market outpaces condo sales.

9. Wells Place, 800 South Wells Street | $39 million

Partners Michigan Avenue Real Estate Group and Syndicated Equities had barely finished construction on their 84-unit South Loop apartment building when Cresset Partners picked up the property this spring. The sellers had bought the site, at that time a surface parking lot, for $6.2 million in 2014.

10. 445 West Wellington Avenue | $30 million

Beal Properties made its own deconversion bid in April, when it paid about $256,000 per unit to convert the 15-story Lakeview building’s 117 condominiums into apartments. The units had been built as apartments in 1953 before becoming condos in the late 1970s.