CHICAGO—Officials from KBS Real Estate Investment TrustII said yesterday that they had closed on the sale, firstannounced in May, of the 300 N. LaSalle building to the NewportBeach, CA-based Irvine Company for $850 million,the most ever paid for a Chicago office building. The deal was alsothe third-largest office building transaction in the US this year,according to CoStar. KBS paid $655 million for the60-story, 1.3-million-square-foot tower on the Chicago River backin 2010.

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“In 2010, KBS REIT II saw a unique opportunity in 300 N. LaSalleduring uncertain economic times,” said chief executive officerCharles J. Schreiber in a prepared statement. “Wedeveloped and implemented a strategy over a 4-year period andultimately exceeded our business plan on behalf of KBS REIT IIinvestors.”

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KBS officials also said they could not comment further.According to a document filed with the US Securities andExchange Commission, KBS “repaid the entire $344.6 millionprincipal balance and all other sums due under a mortgage loansecured by the 300 N. LaSalle Building, including a prepaymentpenalty of $13.7 million.”

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The competitive bidding process for 300 N. LaSalle was overseenby HFF, a provider of commercial real estate andcapital markets services.

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“In 300 N. LaSalle, Irvine saw an irreplaceable, nationallyiconic property in a highly coveted Chicago location,” said KBScentral region president Ken Robertson. “The assethas performed extremely well, which only underscores its enduringquality. We believe this is undoubtedly the trophy office asset ofthis market and a signature property for any office investor.”

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Amenities at 300 N. LaSalle include Chicago CutSteakhouse, as well as a waterfront café and a riverfrontplaza. The property was built in 2009 by Houston-basedHines Interests just north of Chicago's Loop inRiver North, a vibrant submarket with that has attracted a host ofinnovative high-tech firms.

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Brian J. Rogal

Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.