Sterling-owned Loop building seeks buyer for redevelopment

Company hires Greenstone Partners to market property

Greenstone Partners' Danny Spitz (Greenstone Partners, Sterling Organization)
Greenstone Partners' Danny Spitz (Greenstone Partners, Sterling Organization)

An empty 112,000-square-foot building in Chicago’s Loop has landed back on the market, seeking a buyer who will probably tear it down.

The Sterling Organization hired Chicago-based Greenstone Partners to sell the property at 209-227 South State Street, which was home to a Woolworth’s store for years, Crain’s reported. The building has been vacant since a Foot Locker store closed in 2020.

Greenstone is marketing the property as a redevelopment opportunity, given the large lot and zoning that would allow for a tall building to replace the existing one.

“There are so many different ways you can cut it from a development standpoint,” Greenstone CEO Danny Spitz told the outlet. “It’s very rare to find something like this on State Street.”

The building, which Sterling bought for $14.5 million across three transactions in 2018 and 2019, doesn’t have an asking price. County records show Sterling has an $18.3 million mortgage on the building that matures on May 1.

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Sterling first tried to unload the building in mid-2020 by hiring CBRE to find investors. With the pandemic in its early stages, investors weren’t willing to take on a new purchase and lenders were hesitant to grant loans, leaving the property unsold.

While a buyer could keep operating it as a retail property, that market’s slow rebound in Chicago, combined with the improving outlook for multifamilies, means the property could also see new life as that kind of building.

“Apartments make a ton of sense, whether it’s adaptive re-use or ground-up,” Spitz told the outlet.

The seven-story building sits on a 20,300-square-foot parcel, which is zoned for a project up to 325,000 square feet. A developer could also request a zoning change that would allow for an even larger project.

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