CHICAGO-Meridian Capital Group LLC recently negotiated $58 million in permanent financing for the 22-story Burnham Center for owner Harbor Group. The loan for the 90%-occupied building, at 111 W. Washington in the Central Loop, is for three years.
New York City-based Meridian arranged the $46 million first mortgage loan and a $12 million mezzanine loan to recapitalize the property's outstanding first mortgage note and preferred equity investment. The senior loan was provided by Wells Fargo and the mezzanine loan was provided by Redwood Trust.
Ronnie Levine, a managing director with Meridian, says this property is one of those today that are seeing competition by several lenders. He says Harbor is a strong and reputable owner, with the building anchored by government tenants such as Cook County and strong anchors Flashpoint Academy and the architectural firm OWP/P.
Levine tells GlobeSt.com that though the firm has done a lot of deals in Chicago, successful properties in the city depend on location. “Chicago’s vacancy issues and slow job growth is definitely on lenders’ minds,” Levine says. “However, we have seen a significant increase in lender appetite to put out loans. We’ve seen liquidity return to the market, even CMBS is back in a big way. Six to eight months ago, it would have been challenging to get leverage to get this deal done.”
The building was designed by famous Chicago architect Daniel Burnham and constructed in 1917. Norfolk, VA-based Harbor purchased the Burnham Center in 2007 for $79.5 million. Lease rates range from $26.50 to $29 per square foot, gross.
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