Each week, The Elevator Speech summarizes news related to some of the key industry trends, buildings, deals and dealmakers that shaped headlines. Below are articles that caught our attention the week of May 19.
Record-Breaking High Rise Acquisition
The 60-story tower at 300 N. LaSalle has been sold at the highest price in history for a Chicago office property. The 1.3 million square foot building will be sold on June 1 to a Southern California real estate investment firm for $850 million, which amounts to about $654 per square foot. This deal will beat the record that Sears Tower, now called the Willis Tower, set in 2004 when it was purchased by New York investors for $840 million.
Ticket to North Canal
Vivid Seats Ltd., a competitor of Stubhub Inc., will move into a new headquarters at 111 N. Canal St. The company chose the West Loop office space to accommodate its rapid growth and has signed a long-term lease for about 31,000 square feet. The lease includes an option to expand into the remaining 27,000 square feet on the eighth floor of the Canal Street property.
Google Expands at 1K Fulton…Again!
Google Inc. has yet again expanded the space it will lease in 2016 at 1000 W. Fulton Market. Earlier this week, the firm added nearly 105,000 square feet to its lease at the former food storage building, pushing Google’s total space to 357,000 square feet. According to Crain’s Chicago Business, Google’s continual additions of space are likely a defensive move to prevent running out of room in the future.
Four Acquisitions in Six Months
Beacon Investment Properties has purchased the 23-story class A office tower at 200 W. Monroe for $100 million. This is the fourth office building acquired by Beacon within the past six months. Company officials confirmed that they purchased the 535,911 square foot tower as a value-add investment opportunity.
Special Service Area (SSA #1) Update
The Chicago Loop Alliance (CLA) is proposing an early 15-year renewal of the State Street Special Service Area (SSA #1) and a significant expansion of its boundaries that would draw in many more of our member buildings. If approved, this would continue the special tax levy on buildings already within SSA #1’s boundaries, which amounts to 6% of their total property tax bills. It would also extend that levy and increase the property taxes to 38 new buildings.
We recently surveyed our members within the proposed SSA #1 boundaries to gauge their opinions about the CLA’s proposal. The owners or managers of properties that would pay for more than 70% of the total levy by SSA #1 told us that they are opposed to any renewal or expansion. Many of you have told us, and we agree, that a tax of this magnitude bears no relationship to the value of services your buildings might receive from SSA #1.
We are aggressively working on your behalf to defeat the CLA’s proposed renewal and extension of SSA #1. If you would like to get more involved, please contact Ron Tabaczynski, BOMA/Chicago Director of Government Affairs, to discuss what you can do. In the meantime, we’ll continue to keep you apprised of how this issue develops and our efforts on your behalf through our website, newsletter and social media.
What CRE or Chicago news headlines from the past week captured your interest? Leave us a comment and let us know.