CHICAGO—Officials from KBS Real Estate Investment Trust II said yesterday that they had closed on the sale, first announced in May, of the 300 N. LaSalle building to the Newport Beach, CA-based Irvine Company for $850 million, the most ever paid for a Chicago office building. The deal was also the third-largest office building transaction in the US this year, according to CoStar. KBS paid $655 million for the 60-story, 1.3-million-square-foot tower on the Chicago River back in 2010.
“In 2010, KBS REIT II saw a unique opportunity in 300 N. LaSalle during uncertain economic times,” said chief executive officer Charles J. Schreiber in a prepared statement. “We developed and implemented a strategy over a 4-year period and ultimately exceeded our business plan on behalf of KBS REIT II investors.”
KBS officials also said they could not comment further. According to a document filed with the US Securities and Exchange Commission, KBS “repaid the entire $344.6 million principal balance and all other sums due under a mortgage loan secured by the 300 N. LaSalle Building, including a prepayment penalty of $13.7 million.”
The competitive bidding process for 300 N. LaSalle was overseen by HFF, a provider of commercial real estate and capital markets services.
“In 300 N. LaSalle, Irvine saw an irreplaceable, nationally iconic property in a highly coveted Chicago location,” said KBS central region president Ken Robertson. “The asset has performed extremely well, which only underscores its enduring quality. We believe this is undoubtedly the trophy office asset of this market and a signature property for any office investor.”
Amenities at 300 N. LaSalle include Chicago Cut Steakhouse, as well as a waterfront café and a riverfront plaza. The property was built in 2009 by Houston-based Hines Interests just north of Chicago’s Loop in River North, a vibrant submarket with that has attracted a host of innovative high-tech firms.