Search Is on for Tenants of Proposed 505 N. State

The project is being developed by MKDG/Buck 123 LP and 505 Venture Co. LLC, which includes a joint venture by the John Buck Co. and Morgan Stanley. It would be built next to a building developed by Buck and Marvin Davis, which opened in 1990 and is 99% occupied, most notably the namesake American Medical Association. The development would adjoin Buck's North Bridge retail development, anchored by Nordstrom's department store.

Construction hinges on pre-leasing at least 30% of the space, and perhaps landing an anchor tenant. "We've had discussions with potential tenants and are in constant contact with the capital markets," says Buck Co. principal John Iberle. "In this current market, we need a tenant. The way the market is today, no one's starting a building on a spec basis."

The amount of pre-leasing not only will determine how much equity the lenders may require, but it may also determine the building's size. For instance, Iberle says, if an anchor tenant could be found for 100,000 sf, the building may end up being 300,000 sf, satisfying the pre-leasing requirement.

Discussions have been ongoing with a media company, an advertising firm and a financial firm, Iberle says, for becoming that anchor tenant. While Iberle did not name names, one possibility could be the Chicago Sun-Times, located a block south at 405 N. Wabash St. The newspaper's building reportedly is being eyed by Donald Trump for a condominium project.

The joint venture would preserve a plaza on the southeast corner of the property, in the middle of the two buildings. "We've accommodated the city has as far as landscaping," Iberle says.

The proposal has garnered support from the Greater Michigan Avenue Association, and city officials say no concerns were expressed by residents of the neighboring River Plaza multifamily building.