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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. DRW scraps plan for 17-story hotel on Fulton Market – Trader Don Wilson filed plans with the city for a Brooklyn Bowl bowling alley and nightclub on West Fulton Market, with one major omission: a 17-story hotel. The development arm of Mr. Wilson’s Chicago-based DRW Holdings LLC filed an application with the city June 25 to change the zoning for the property at 832-856 W. Fulton Market, where DRW plans the bowling alley from New York-based Brooklyn Bowl. But the application limits the development to three stories and makes no mention of the hotel that had been included in previous plans. The building would have stood 17 stories with many as 200 rooms. In the plan filed with the city, maximum height would be 50 feet… Crain’s Chicago
  2. Engagement Is Open Space’s Driving Force – Different degrees of open space in an office environment are acceptable to different firms, and it’s the design team’s job to determine the which degree matches the clients’ needs best, Heidi Hendy, founding principal of H. Hendy Associates, tells GlobeSt.com. But a uniting force behind all degrees of open-space work environments is the need for engagement among staff members. As GlobeSt.com reported in May, the locally based interior architecture firm has completed the construction of Monster Energy’s new headquarters building at 1010 Railroad St. in Corona, CA… Globe St.
  3. GE spinoff moving to Loop office complex – The owner of a 60-story Loop office complex brought in a General Electric Capital Corp. subsidiary to help offset the future loss of its two largest tenants. Retail Finance International Holdings Inc., a consumer finance unit of Norwalk, Connecticut-based GE Capital, signed a 76,000-square-foot lease at 227 W. Monroe St. in Franklin Center, according to a person familiar with the deal. The lease closed in the second quarter, and the GE unit is moving from office space the company occupies at nearby 500 W. Monroe St., the person said… Crain’s Chicago
  4. The Roll of the Office Cycle – In many ways, the office sector’s position along the real estate cycle resembles that of the 2005/2006 period. The market is rising at a steady pace, as it did in 2005 and 2006: average national vacancies, which have fallen for four years straight, are under 12 percent and closely aligned with 2005 levels. Investors are once again underwriting strong income growth, as rents signed at the bottom of the market will receive mark-ups when they roll to market rate—at least at the better-quality assets. Liquidity is strong, with trading volume well above historical averages and nearly back to 2007 peaks (when the assets of the former Equity Office Properties portfolio ping-ponged between investors)… NREI
  5. Office Recovery Spreads Across US – During the second quarter, the US office sector reached a milestone on its road to a true recovery, according to a new research by JLL. Although office users and landlords reported a lot of activity, it was perhaps more significant that increased velocity was seen in markets far beyond the gateway cities and areas like New York, San Francisco and Silicon Valley. “First and foremost, we saw in the second quarter about 14-million-square-feet of net absorption,” John Sikaitis, JLL’s managing director for local markets and office research, tells GlobeSt.com, a boost of about 38% from the second quarter of last year. Overall, tenants leased 61.9-million-square-feet of space during the second quarter… Globe St.