A 24-story workplace tower on Magazine Mile is up on the market, in what is going to probably be seen as a check of the marketplace for actual property on the famed buying hall.
An possession group led by New York actual property investor Samuel Schapira has employed Colliers Worldwide to promote the largely vacant workplace constructing, in accordance with Crain’s.
Whereas the 343,000-square-foot constructing at 500 N. Michigan Ave. doesn’t have a public value on its itemizing, an unidentified supply conversant in the providing instructed Crain’s it was anticipated to get round $110 million.
The itemizing suggests potentialities past places of work for the house, akin to changing the tower to residential, senior housing, or a lodge. The portion of the constructing devoted to workplace house is 321,000 sq. toes and at present 70 p.c vacant. The constructing consists of separate low-rise and high-rise elevators, which might enable for a number of completely different makes use of inside the tower. Colliers’ John Homsher and Alissa Adler representing the possession group.
Ought to the 54-year-old constructing promote, it’ll provide perception into how builders plan to reposition actual property on Magazine Mile submit COVID.
Magazine Mile has been hit arduous by the pandemic. 1 / 4 of retail house is vacant, in accordance with Crain’s. Retailers vacating the Magazine Mile embrace Ceaselessly 21, which left 42,000 sq. toes alongside North Michigan Avenue earlier than the pandemic. In some instances, landlords are struggling to interchange them and constructing homeowners have tried to create smaller areas for retailers. The North Michigan Avenue retail emptiness price rose to 26 p.c in 2021 from 5.3 p.c in 2017, in accordance with Cushman & Wakefield.
Two malls, Water Tower Place and the Outlets at North Bridge, are dealing with unsure futures as their property values dropped and emptiness elevated.
Workplace demand can also be gradual to return to regular, additional stunting retail. Full restoration is unlikely with no return to downtown places of work by these at present working from residence – lower than 40 p.c of the workforce, in accordance with Kastle Methods.
The possession group paid $86 million for the property in 2017, after which refinanced it in 2019 with a $94 million mortgage, in accordance with the publication.
On the time of the acquisition, the workplace portion of the constructing was two-thirds leased. The retail portion is totally leased, and the flier for the itemizing mentioned the weighted common lease time period is 10 years. Tenants embrace Chick-fil-a, Financial institution of America and Vans.
[Crain’s] — Miranda Davis
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