Sterling Bay negotiating to buy 2.7-acre site at Fulton Market

Sterling Bay is eyeing the largest remaining development site in Chicago’s Fulton Market.

The developer is negotiating to buy a vacant 2.7-acre site on the west side of Peoria Street and the Metra tracks running through the corridor from meat wholesaler Nealey Foods, Crain’s reported, citing sources familiar with the talks. Sterling Bay is likely to pay more than $105 million for the property or at least $900 per square foot, the publication reported.

The property is close to the developer’s office building projects at 345 North Morgan Street and 330 North Green Street. The southwest corner of the Nealey lot also borders a 13-story office building at 320 North Sangamon Street and Ace Hotel, which Sterling Bay sold to Canadian developer Onni Group for $63 million.

The owner of Nealey Foods sold two of its properties in the district, one at 900 West Fulton Market and another across the street, for more than $32 million in 2019, according to Cook County property records. Nealey relocated its facility to South Lawndale following a string of companies that left Fulton Market after tech and life science firms started moving in.

While Chicago’s office market is still struggling to return to pre-pandemic levels, demand for Class A buildings in Fulton Market pushed rents to $43.36 per square foot in the fourth quarter last year, the highest among the city’s downtown submarkets.

A newly built 45,380-square-foot building at 1100 West Fulton Market sold for about $925 per square foot last year, breaking the 2020 record of about $870 per square foot that a German investor paid for Mondelez International’s headquarters at 905 West Fulton Market.

[Crain’s] – Connie Kim