Sterling Bay Sells Entitled Fulton Market Site at Loss

Sterling Bay is continuing its sell-off streak, taking a $1.9 million loss on a prime Fulton Market parcel where the firm envisioned a 39-story apartment tower.

The Chicago developer sold the vacant site at 350 North Morgan Street for $18 million to a venture led by local investor Marc Bortz, Cook County property records show. The deal closed months after Sterling Bay secured Chicago City Council approval for the high-rise, but the firm has been trimming its pipeline as financial pressure mounts, Crain’s reported.

Sterling Bay bought the parcel in March 2020 for $19.9 million. At the time, it planned an 18-story office building for Google, which would have marked a major expansion for the tech giant. The pandemic killed that deal, and like many developers, Sterling Bay pivoted to residential. The city signed off earlier this year on its plan for 500-plus apartments.

Sterling Bay has struggled to keep momentum at Lincoln Yards, the $6 billion megaproject it planned on the North Side. The company handed control of the northern portion to a lender and is reportedly preparing to sell off the southern half as well. Last month the firm listed a vacant, 284,000-square-foot lab-and-office building at 1229 West Concord Place in Lincoln Yards. That building has a $67 million loan from Bank OZK maturing this month.

It has listed other Fulton Market sites, a Loop office building and land near Lincoln Yards, even as it nears a deal to acquire Boeing’s former Chicago headquarters in the West Loop, a 36-story building at 100 North Riverside Plaza, which Boeing has owned since 2005.

Bortz’s group could press forward with the entitled resi tower or pursue a new concept altogether. If apartments are the play, they’d land in a hot rental market: Class A downtown rents climbed to $3.99 per square foot midway through 2025, up 6.4 percent year-over-year.

— Eric Weilbacher