Clarion Partners has offloaded a mixed-use property in downtown Naperville at a substantial loss compared to its previous trade.
Chicago-based real estate firm Bucksbaum Properties bought the River District shopping center at 22 East Chicago Avenue for $22 million, marking a financial loss of over $7 million compared to the price Clarion paid for the property in 2019, CoStar reported.
The property spans nearly 59,000 square feet and includes tenants such as Chipotle, Five Guys and Rosebud. It also features 12,000 square feet of second-floor office space, making it a prime commercial hub within the heart of Naperville’s historic downtown area.
Northbrook-based Clarion Partners purchased the shopping center from Savas Er for $29.3 million in 2019, with hopes of capitalizing on increasing demand and rental income in Naperville’s vibrant downtown district. At the time, the property had seen an increase in rents, as many tenants had renewed at higher rates, boosting the property’s value.
However, broader challenges facing the Chicago-area retail market and rising vacancies took a toll on the asset’s profitability.
Bucksbaum Properties, led by founder John Bucksbaum, plans to leverage its development and property management expertise to maximize the potential of the River District.
Retail in Chicagoland has been slower to rebound since the pandemic than some Sun Belt markets. Downtown Chicago is especially struggling, as retailers exit the Magnificent Mile and some landlords encounter distress. Even New York-based Ben Ashkenazy, who is known to fight for his assets, surrendered a Mag Mile retail holding in a deed-in-lieu of foreclosure workout after a $61 million default recently.
Also in the Loop, the T.J.-Maxx-anchored retail center at 1 North State Street is headed to foreclosure auction after its landlord, New York-based investor Isaac Shalom, defaulted on a $60 million loan.
— Andrew Terrell
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