CBRE looks to unload Michigan Avenue office tower

Another Michigan Avenue office tower is up for sale. 

New York-based CBRE Investment Management tapped Eastdil Secured to sell the Smurfit-Stone Building, 41-story tower at 150 North Michigan Avenue, Crain’s reported. The new listing follows the recent trend where old or outdated office buildings with low occupancies are being unloaded and, in some cases, marketed for residential conversions.

Eastdil’s Stephen Livaditis and Bryan Rosenberg have the listing.

Individuals familiar with the property said they expect it to sell for roughly the same amount as the firm’s $87 million mortgage on the tower. According to data from CoStar Group, the mortgage with MetLife was set to mature at the end of September. 

A sale at that price would be far below the $121 million CBRE paid for the property in 2017. The firm also invested in about $35 million for significant upgrades, including a new tenant lounge and revamped lobby area.

The 39-year-old Michigan Avenue building, which is most identifiable by its diamond-shaped rooftop, is 68 percent leased, which is below the downtown office average of 79 percent at the end of 2022. 

Eastdil is leaning on the building’s existing cash flow and updated amenities as selling points. In addition, with many leases set to expire and the option to relocate some of the smaller tenants, an investor could create a 10-floor block of contiguous space in the middle portion of the tower.

This listing follows news that Larry Weiner’s Marc Realty hired CBRE to market 180 North Michigan Avenue, the 24-story 235,0000-square-foot Class B building that is leased by the American Writers Museum and the embassies of Spain and Peru, with retail on the ground floor. CBRE is marketing the property as a prime candidate for residential conversion. The neighborhood already includes a handful of hotels and apartment towers.

 — Victoria Pruitt