X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

CHICAGO-After undergoing a makeover but still about 84% leased, a 10-story office building at 29 N. Wacker Dr. has sold for $18.2 million. Boston-based Intercontinental Real Estate Corp. bought the class A building from GE Capital and Hines Interests L.P., which paid $8.7 million for it in 1997.

While it underwent extensive interior and exterior renovation designed by the architecture firm of Skidmore, Owings & Merrill, the 130,000-sf building’s location in the desirable West Loop submarket two blocks from the Richard Ogilvie Transportation Center was a selling point.

The sale is the third major office deal in the West Loop, with the three sales totaling $99.5 million. The other two sales involved 29-story 200 W. Jackson Blvd., which sold at $84 per sf, and 200 W. Madison St., which traded at $35 per sf.

The 29 N. Wacker Dr. purchase was made for the $250-million private-equity Intercontinental Real Estate Fund III, LLC, which is targeting current returns of 8% to 9% and an internal rate of return of 15% in its acquisitions. Planning to have up to 50% of its acquisitions outside New England, the fund’s first acquisition included the 75,000-sf Canyon at Wild Basin in Austin. TX.

Financing for 29 N. Wacker Dr. was obtained from Mellon Bank, which provided a $13.5-million first mortgage.

“We feel this property will serve as a strong fit for our third fund — targeting properties that are presently generating an attractive current return and also have the potential for capital appreciation through some degree of asset repositioning, re-tenanting or through moderate physical or financial rehabilitation,” says Intercontinental CEO and Chairman Peter Palandjian. “The recent upgrades to the structure coupled with its strong rent roll and superior location in one of the most important Chicago office market offers a very attractive investment opportunity for the fund.”Tenants include Intertec Publishing and American Federation of State, County and Municipal Employees.

Cushman & Wakefield office specialists Brian Nagle, Paul Lundstedt and John Gavin represented GE Capital and Hines Interests L.P. in negotiations with Intercontinental senior vice president John Matteson.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.