Chicago Office Market Off To A Blazing Start As 2 More Properties Change Hands
The transaction market for Chicago office properties is roaring back to life as the new year gets underway, with two more buildings reportedly changing hands in deals that include the largest downtown office property sale by square footage in nearly three years.
Namdar Realty Group and Mason Asset Management completed an $85M purchase of the 57-story office tower at 70 W. Madison St. on Dec. 30, the largest downtown office property sale by total leasable space in almost three years, CoStar reported. The tower, which totals more than than 1.4M SF, is the largest property to trade hands since a controlling stake in the nearly 1.6M SF Bank of America Tower sold in March 2022.
The 70 W. Madison St. property last sold in August 2014 to a joint venture between GEM Realty Capital and Farallon Capital Management. The venture refinanced the tower with a $305M loan from a group of lenders led by Bank of America in 2018 before those lenders filed a $275M foreclosure suit against the owners last year, according to CoStar.
Elsewhere in the Loop, a venture that includes Murphy Development Group CEO John Murphy and InSite Real Estate Managing Director Gerald Kostelny reportedly struck an agreement with lenders controlling the 65-story office tower at 311 S. Wacker Drive. The venture will purchase the property for about $70M, according to Crain's Chicago Business.
The deal still isn't finalized, but a completed transaction close to that price would be a fraction of the $302M that Zeller Realty Group and Chinese investor Cindat Capital Management paid for the tower in 2014.
These two deals became public soon after a separate pair of office properties changed hands at the tail end of 2024.
A joint venture between 601W Cos. and David Werner Real Estate Investments secured a $62.5M loan from Northwind Group to buy 303 E. Wacker late last month in the larger of the two deals. The property last sold for $182M to Beacon Capital Partners in 2018.
In the West Loop, Brog Properties bought the mostly vacant 16-story office building at 550 W. Washington Blvd. late last month from a venture of New York-based Metropolitan Life Insurance for about $18.5M.
