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CHICAGO-Like most single-family sellers who try the “for sale by owner” route, the city has called in professional brokers to market a prime West Loop development site. Jones Lang LaSalle got the assignment to market a two-acre parking lot at the southwest corner of Madison and Des Plaines streets, already reporting strong initial interest evenly split between local prospects and those outside the market.

Current zoning could accommodate a 900,000-sf office tower, Lynch says, but the city’s department of planning and development has indicated flexibility for additional space. Ground-floor retail space and a parking garage also would be favored by city officials, Lynch says, and plans for a hotel would get consideration. The city will take a dim view, though, on multifamily development.

“They’d like to see another ABN-AMRO or UBS Tower on that site,” says Lynch, referring to a 1.3-million-sf project under construction north of the site as well as a 1-million-sf building a few blocks east that sold a year after completion.

City officials believe an attempt two years ago to sell the site through the traditional request for proposals route was not broad enough, and resulted in offers that hinged on city assistance, Jones Lang LaSalle’s John Lynch tells GlobeSt.com. Also gone is the $15.1-million–$175 per sf–target price, he adds.

“We advised them to not go out with an asking price this time,” Lynch says. “The range in values will depend on how far along someone is on their plans for the West Loop…We’re going to let the market dictate what the price is on the asset.”

For example, a developer may already have a lead tenant on the line for 2006 occupancy or later, Lynch explains, giving him an advantage—and perhaps a reason to bid stronger—than the rest of the field.

Using brokers to sell city-owned property is a new way of doing business for the city, Lynch notes, and the pilot program could become the wave of the future.

Jones Lang LaSalle will seek letters of intent from interested US and international developers, and will host a conference with would-be bidders May 15. The city will ultimately talk with finalists about their specific plans for the property.

Jones Lang LaSalle has a motivated client dealing with a budget crunch that wants to close by the end of the year, Lynch notes. “That’s a tight time frame, but you don’t have too many sites out there like this one,” he adds.

Besides being bordered by the Kennedy Expressway, the site is within three blocks of Metra’s two major commuter rail stations. With completion of any project not likely until 2006 at the earliest, the city and Jones Lang LaSalle don’t expect the current weakness in the West Loop office market to dampen interest.

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