After months of pandemic-induced delays, Sterling Bay is set to begin construction on a Fulton Market office building after securing a substantial loan.
Bank OZK provided the senior loan on the 200,000-square-foot project at 345 North Morgan Street, while Pacific Coast Capital Partners provided a mezzanine loan, according to Crain’s.
The 11-story complex is estimated to cost $120 million. It was originally intended for Google as the lone tenant, but the deal fell apart amid the pandemic.
Work is expected to start this week and be complete by the third quarter of 2022. The building is expected to include a 5,000-square-foot rooftop deck and a private outdoor terrace on every floor.
Bank OZK and Sterling Bay have a history, with the lender having financed a $250 million hotel and residential tower on North Michigan Avenue.
There are no tenants signed yet for the building. Sterling Bay bought the property seven years ago for $4 million. The trendy district has seen success with office leases during the pandemic, despite Chicago’s overall struggling market. Kimberly-Clark, Tock, Calamos Investments and Teknion are among the companies to sign new office leases in Fulton Market in recent months, the report noted.
Sterling Bay was planning to begin work at 345 North Morgan in early March 2020, but the pandemic disrupted those plans. Then, there was a legal battle between Sterling Bay and Ohana Real Estate Investors over bonus development rights, which was eventually settled.
[Crain’s] — Holden Walter-Warner