Novak Picks up Southern Portion of Lincoln Yards for $34M

The price for John Novak’s year-end deal to buy the troubled southern portion of Lincoln Yards from JP Morgan Asset Management and Sterling Bay amounted to $34 million.

Novak Construction acquired the 18.4 acres of vacant riverfront land where Chicago-based Sterling Bay had proposed a huge multibillion-dollar mixed-use campus. CoStar first reported the sale price. The property sits just west of the empty life sciences building Sterling built at 1229 West Concord Place, a 284,000-square-foot lab and office property that remains the only completed building at the proposed megadevelopment.

The sale follows the announcement that two other parcels adjacent to the Lincoln Yards site sold last month to an affiliate of Calgary, Alberta-based Jack Carter Automotive Group. It paid $15.5 million for the parcels at 1642 North Besly Court and 1400 West North Avenue.

Novak’s purchase was the second try at a deal for the southern portion of the site. JP Morgan and Sterling Bay first attempted to sell the site earlier last year to developers JDL and Kayne Anderson at a price Chicago real estate sources pegged at about $60 million. That deal eventually fell apart after JP Morgan balked on completing the transaction.

Kayne and JDL did however form a development team last year to buy the northern 30-plus acres of Lincoln Yards — which sits on the other side of the Chicago River from Novak’s purchase — from Bank OZK. Bank OZK had stripped that portion of riverfront property from Sterling Bay and Dallas-based Lone Star Funds, its other partner on the megadevelopment, through a deed in lieu of foreclosure. JDL and Kayne have since sought Chicago City Council approval to build more than 3,700 residential units on that stretch.

Novak told The Real Deal last month that the Lincoln Yards deal would amount to the most land his firm has ever purchased for development. The 45-year-old company began as a general contractor, but in recent years has forayed into development projects that include big box retailers such as Target and Whole Foods.

— Eric Weilbacher