601W Companies, which transformed the hulking but deteriorating Old Post Office into a modern multi-tenant office building, is taking on another major redevelopment project nearby.
The New York-based developer plans to embark on a $180 million overhaul of the 591,000-square-foot building at 801 South Canal Street, Crain’s reported. 601W bought the office building in January, for $68 million. The seller was a venture led by developer Paul Gearen.
The now-vacant six-story building had until recently been fully occupied by financial services company Northern Trust. It vacated the space at the end of its lease to consolidate operations into a new location at 333 South Wabash Avenue.
To redevelop the 2.5 million-square-foot Old Post Office, 601W spent $800 million and inked big leases with tenants like Uber, Walgreens and Ferrara Candy.
But now is a difficult time for the office market. Across the U.S., office vacancy has been rising, and Chicago is no exception. But Matt Whipple of Telos Group, which is marketing 801 South Canal, said 601W is betting that a property redesigned for the post-pandemic world will attract tenants, Crain’s reported. The new building will be named Canal Station.
601W is also renovating an office tower at 1 South Wacker Drive as well as the Aon Center, where the firm is spending $185 million in upgrades.
In New York, 601W has reportedly struck a deal with SL Green Realty to purchase the Amazon-anchored property at 410 10th Avenue for $952.5 million. The property is undergoing a building-wide redevelopment project. [Crain’s] — Akiko Matsuda