MEPT Pays $218M for Chicago’s 200 W. Madison

CHICAGO-Multi-Employer Property Trust has purchased of 200 W. Madison, a 928,040-square-foot class A office building in Chicago's West Loop neighborhood, for $217.5 million. The seller was a joint venture that includes Tishman Speyer, Pearlmark Real Estate Advisors LLC and a major US pension plan.

Paul Barile and Janice Sellis of Transwestern's Investment Services Group represented MEPT in the transaction. MEPT is a $5.1-billion open-end commingled real estate equity fund. It acquired the 88% leased office building through a limited partnership subsidiary in an all-cash transaction.

“The vacancy rate in the West Loop has fallen over the last several quarters and demand for office space has been led by companies relocating to and expanding in downtown Chicago,” explains David Antonelli, executive vice president and MEPT portfolio manager at Bentall Kennedy, real estate advisor to MEPT. “We think this trend will continue and benefit office buildings such as 200 W. Madison in Chicago's central business district.”

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Antonelli points out that 200 W. Madison is “a great fit for MEPT's portfolio especially because of the building's urban, infill location and its environmentally-efficient property operations.” Located at the intersection of Madison and Wells Streets, the 45-story building has access to public transportation, is a short walk to restaurants, shopping and hotels, has an award winning lobby and building renovations, and has earned Leadership in Energy & Environmental Design Silver certification from the U.S. Green Building Council.

The building is leased to a diverse base of approximately 70 tenants including law firms, financial services groups, a design school and other service businesses. As a long-term owner, MEPT plans to solidify the building's competitive position by completing certain capital improvements and modernizations and attracting high-quality tenants to the building through a program of active asset management and marketing, according to a prepared statement.

“On behalf of MEPT, we are actively looking to acquire well-leased, well-located assets in major markets across the U.S. and 200 West Madison certainly fits that profile,”says Paul Boneham, executive vice president and head of U.S. transactions at Bentall Kennedy. “Our focus continues to be on acquiring multi-family assets in urban markets serving the Echo-Boom generation, grocery-anchored retail centers in established neighborhoods, and high-quality CBD office properties.”