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Monthly Archives: June 2014

Chicago Commercial Real Estate – In the News

Tom’s Recommended Reading for the Week

Check out the top news in Chicago commercial real estate before heading into the weekend!

  1. Five Reasons People are More Important Than Buildings – The word “office” doesn’t mean what it used to. When workers refer to going into the office, they could mean they’re heading to the brick-and-mortar building that houses their company, but they could also be referring to the unlimited expanse of the digital and technological world that connects the workforce in previously unimaginable ways. Today’s office travels where the worker goes.This worker-centric structure requires that the workspace be flexible, mobile, and managed by technology. Times are changing, and the office needs to keep up. Here are five ways offices should already be putting people first… WorkDesign Magazine
  2. LaSalle Street office towers sell for $270 million – Two office towers facing each other on LaSalle Street sold for more than $270 million combined. New York-based AmTrust Realty Corp. paid $237.5 million for the 43-story tower at 30 N. LaSalle St., while Chicago-based John Buck Co. paid $32.8 million to seize a financially distressed 38-story tower at 33 N. LaSalle St. through a deed-in-lieu of foreclosure, according to Cook County property records… Crain’s Chicago
  3. New, state-of-the-art headquarters to stand as symbol of Zurich’s growth in North America – Zurich North America Commercial and North American Regional Chairman Mike Foley and dignitaries, including Illinois State Sen. Dan Kotowski, Illinois State Rep. Michelle Mussman and Schaumburg Mayor Al Larson, have broke ground on Zurich’s new North American headquarters. The 40-acre site will be home to the 735,000-square-foot-building that will house 2,500 employees and contractors who work in Schaumburg and live in the surrounding communities… RE Journals 
  4. Rent jump at Chicago’s best office towers – Chicago office landlords that endured the recession are enjoying a comeback — for those who own high-end towers, anyway. Landlords with upper-tier buildings collected a lot more in rent last year than they did in 2012, according to a report by New York-based Savills Studley. The report looks at effective rents, which factor in extra costs that affect how much landlords take in and tenants pay out… Crain’s Chicago
  5. Tech Firms Hitting the Tipping Point  According to the new MBRE Index, landlords of the 30 newest class A office buildings in downtown Chicago saw, partly due to significant leases signed by tech firms, the direct vacancy rates for their properties decline over the last quarter from 11.2% to 10.3%. The decline was a recovery from the previous quarter, when the same buildings had an increase in vacancy, breaking what had become a pattern of steady improvement in the market… Globe St.
 

Chicago Commercial Real Estate – In the News

Tom’s Recommended Reading for the Week

Check out the top news in Chicago commercial real estate before heading into the weekend!

  1. Charles Schwab Chooses 150 S Wacker as long-term home – Charles Schwab has selected 150 South Wacker Drive for its corporate offices, inking a lease for 105,000 rentable square feet at the strategically located West Loop office tower. Schwab was represented by Colliers International, and ownership of 150 South Wacker Drive was represented by Fulcrum Asset Advisors, LLC and Lincoln Property Company. With its 65,000 square foot expansion, Charles Schwab is now the largest tenant at 150 South Wacker Drive, and has committed to occupy 20% of the building… RE Journals
  2. Musicians performing in glass at the Hancock? Could Happen – Not long after luring thrill-seekers to the “Tilt” on its 94th-floor observation deck, the John Hancock Center may get an eye-catching addition at street level. An owner of the 100-story tower hopes musicians will soon entertain crowds in the public plaza from inside a glass, diamond-shaped structure rising four to five stories above North Michigan Avenue… Crain’s Chicago
  3. Sterling Bay Launches Remake of Post Office – A lot of rumors have swirled around the eventual fate of the city’s old Main Post Office Building, but yesterday officials from Sterling Bay Companies said they would partner with owner Bill Davies, chair of International Property Developers North America, to redevelop the property. The partners envision that the first phase will cost $500 million and transform the hulking structure, which arches over the Eisenhower Expressway, into 2.7-million-square-feet of modern office space and retail amenities… Globe St.
  4. War for Talent Driving Office Leasing Decisions – There’s a massive shortage of available workers between the ages of 18 through 64 happening today, a trend that is causing company CEOs sleeplessness and will ultimately affect where prime offices will be located by 2030.According to a recently released Cushman & Wakefield report, “Human Capital: The War for Talent and its Effect on Real Estate… NREI
  5. Trouble at Top  The Willis Tower in Chicago—formerly the Sears Tower—is hitting a patch of financial turbulence as its owners try to fill vacant space. Earlier this month, Fitch Ratings reported that the owners of the boxy, black skyscraper were seeking a loan modification to complete a lease. The ratings company said the $774 million mortgage on the tower was transferred to the control of special servicer CWCapital Asset Management LLC, a distressed-debt specialist that oversees modifications on behalf of investors that hold the tower’s debt… Wall Street Journal
 

Chicago Commercial Real Estate – In the News

Tom’s Recommended Reading for the Week

Check out the top news in Chicago commercial real estate before heading into the weekend!

  1. Chicago’s Suburbs Suffer from Companies’ Flight to CBD – As members of the millennial generation continue to choose downtown living, the companies that follow them may be the bigger story of the economic recovery. But this flight to urban cores is coming at the expense of suburban class-A office parks.Suburban Chicago’s 155-million-sq.-ft. office market, which now has approximately a 23 percent vacancy rate, shows a continued struggle for relevancy. The Windy City’s suburbs experienced 1.2 million sq. ft. of negative space absorption in the first quarter, with demand stunted in part because large firms were either packing up and moving downtown or consolidating multiple uses in single locations. The moves included Motorola Mobility’s removal from 1 million sq. ft. in Libertyville, Ill. to the Merchandise Mart in the Chicago Central Business District (CBD), and Capital One leaving 200,000 sq. ft. in Mettawa to move to the former United Airlines space at 77 West Wacker… NREI
  2. Energy, Jobs Loom Largest as CRE Issues – The number one issue affecting commercial real estate in the near and long term? America’s growing energy independence, says the Chicago-based Counselors of Real Estate, which put it at the top of its annual Top Ten Issues Affecting Real Estate list, released Wednesday. Other issues in the association’s top 10 list this year: jobs, millennials, healthcare, globalization, water supply, the capital markets, housing, manufacturing and agriculture. “The list reflects growing economic and political turmoil, changing demographics and the lifestyle choices of an emerging generation, rising energy independence in the United States and a strengthening job market fueled in part by massive changes in the delivery of healthcare,”… Globe St.
  3. Four new hotels under way in Schaumburg  The long paralyzed growth of the hospitality industry in Schaumburg will break its shackles this summer as construction gets under way on four new hotels. Final approval is scheduled Tuesday for an extended-stay TownePlace Suites and a short-stay Fairfield Inn & Suites to be built side by side along National Parkway, near Higgins Road and the Tilted Kilt restaurant. A 93,000-square-foot Cambria Suites hotel delayed by economic concerns since its approval in 2006 has changed to a Radisson hotel and will break ground next month… DailyHerald
  4. Office investor doubles down on Monroe Street with $122 million buy  A Florida office investor is paying about $122 million for a 29-story Loop tower next to another office building it already owns. Real estate fund manager Beacon Investment Properties LLC is working to finalize a deal in which it would pay about $196 per square foot for 230 W. Monroe St., which is about 32 percent vacant, according to people familiar with the transaction. Although it is a relative newcomer to Chicago, Beacon is quickly gaining familiarity with the neighborhood around the 623,524-square-foot tower, which was completed in 1971… Crain’s Chicago
  5. Incremental Improvements in the Office Market Are No Longer a Surprise  The national vacancy rate for the office sector fell to 16.8 percent in the second quarter, a 10 basis point decline over the first quarter of the year. This is in line with trends witnessed over the last three and a half years. Vacancies peaked at 17.6 percent in late 2010, and since then any recorded declines were no larger than 10 basis points. It has certainly been a slow recovery, but quite in line with expectations, given an economy that has been growing at an average of 2 percent per year since the end of the recession. On a slightly positive note, net absorption registered its highest quarterly increase since late 2007, with occupied stock rising by 9.8 million sq. ft… NREI
 

Bradford Allen Represents Consumers Digest Communications in Lease Renewal

CHICAGO – Consumer Digest Communications, a consumer products review periodical, has signed a 9,987 square foot, long-term lease renewal at 520 Lake Cook Road.   The publisher has operated out of its Deerfield location for the past ten years.

Bradford Allen Senior Managing Director Ben Azulay represented Consumer Digest Communications in the transaction.  Chris Cummins and Steve Kling of Colliers International represented the landlord, Arden Realty.

“Consumers Digest Communications analyzed several relocation options in the area, but ultimately the combination of the building’s quality and location made a renewal the optimal decision for them,” said Azulay.

About Bradford Allen Realty Services

Bradford Allen Realty Services, a Chicago-based commercial real estate firm, offers a full range of services and expertise to entrepreneurial and corporate business entities as well as not-for-profit organizations. The firm provides real estate strategy, advice, marketing, and transaction execution for occupiers, investors and owners of real estate. For more information please visit our website at www.bradfordallen.com.

 

Chicago Commercial Real Estate – In the News

Tom’s Recommended Reading for the Week

Check out the top news in Chicago commercial real estate before heading into the weekend!

  1. After Hancock buy, Hearn to pay $375 million for Loop office tower  –  In yet another sign of climbing office building values downtown, Hearn Co. is paying about $375 million for the 57-story Three First National Plaza in the Loop. Chicago-based Hearn will pay about $260 per square foot, or 9 percent more than a Hong Kong-South Korea venture paid less than three years ago for the 1.4 million-square-foot tower at 70 W. Madison St., according to people familiar with the transaction… Crain’s Chicago
  2. Art Deco tower on Wacker Drive could fetch $48 million –  An 85-year-old riverside tower previously redeveloped as an office condominium building is now being offered for sale outright, with the owners hoping to fetch close to $48 million. The owners, a group of South American investors affiliated with Miami-based Cape Horn Group LLC, hired Los Angeles-based CBRE Inc. to sell most of the 41-story art deco tower at 221 N. LaSalle St., also known as the LaSalle-Wacker Building, confirmed Dan Deuter, senior vice president in CBRE’s Chicago office… Crain’s Chicago
  3. Five Ways to Make Your Office A Happier, More Productive Place   According to Gallup’s 2013 State of the American Workplace Report, which surveyed more than 150,000 full- and part-time workers, only 30 percent of employees are engaged and inspired at work. A happy worker means a more productive worker, so it’s important that managers make serious efforts to make their workplace more enjoyable. So what is it that today’s workforce wants? And how can you give it to them in a way that’s cost-effective and best for your company? Elizabeth Dukes, co-author of Wide Open Workspace and co-founder of iOffice, has five suggestions… Work Design
  4. Chicago’s land marking push unsettles burgeoning Fulton Market area  Richard Pastorelli’s family has worked in the West Loop market district for 87 years and has a colorful history to show for it. Pastorelli, president of the company his grandfather founded in 1927, said Pastorelli Food Products survived its early years by bartering with the manufacturers that lined Randolph Street, trading truckloads of sugar and soap chips for paper and canned goods. During the Depression, he said, the company sold sugar primarily to Al Capone’s distilleries that occupied the second floors of many buildings along the corridor… Chicago Tribune
  5. O’Hare Marriott owner plans big office project next door   More than four decades after it was built, the Chicago Marriott O’Hare could add some new neighbors—office tenants. The property’s owner, Host Hotels & Resorts Inc., is asking the city for a zoning amendment that would allow development of 750,000 square feet of new office space and a 3,000-space parking garage, according to plans filed with the city. Host’s plans show three office buildings of up to 18 floors surrounding the parking structure, all of which would be built along the west side of the hotel. The site is on Higgins Road on the north side of the Kennedy Expressway, between River and Cumberland roads… Crain’s Chicago