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This Week's Chicago Deal Sheet

Willis Tower just earned the U.S. Green Building Council’s Leadership in Energy and Environmental Design’s Platinum designation, making it the largest American building to do so, according to officials from property owner EQ Office, a company wholly owned by Blackstone.

The 110-story tower earned LEED Gold in 2018, but ownership made a number of improvements to its heating, electric, water and lighting systems since then, changes that will further boost its reputation among environmentally conscious tenants.

Willis Tower
Willis Tower's Catalog

“Our tenants and their employees are passionate about working in offices where sustainability is a priority, and we’re proud that our commitment to sustainability, which extends throughout our portfolio, has earned Willis Tower the prestigious LEED Platinum certification,” EQ Office Senior Vice President and Portfolio Director David Moore said in a statement.

In partnership with Rivion, a Wisconsin-based energy consulting firm, EQ revamped the HVAC system, which officials expect will reduce energy consumption by up to 20%. It also replaced electric hot-water generators with natural gas boilers, reducing heating water energy consumption, and installed energy-efficient LED lights, among other changes.

“We are committed to driving greater sustainability by making the assets in our portfolio more energy efficient,” Blackstone Real Estate Global Head of Asset Management Giovanni Cutaia said. “The capital we are investing in Willis Tower will not only make it a better place to work and visit, but also better for the planet.”

Blackstone and EQ launched a more than $500M renovation, which included adding 125K SF of tenant-exclusive amenities; Catalog, a new 300K SF retail, dining and entertainment venue; and a future 30K SF outdoor deck and garden.

EXECS

Newmark Knight Frank expanded its Midwest valuation and advisory practice by adding 10 valuation professionals who will work in the new west suburban St. Charles office. All joining from RVG Commercial, the new members of NKF are Edward Kling, Peter Helland, Michael Lysien, Keith Stewart, Donald DiNapoli, Scott Kling, Steve Bloch, Michael Crum, Agnieszka Jurowska and Brenda Culotta.

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Global law firm Greenberg Traurig LLP added two real estate shareholders in the firm’s Chicago office. Joining are Elizabeth Friedgut, who was previously with DLA Piper, and Andrew Ryerson, previously with Polsinelli.

Federelas
Federales in Fulton Market

SALES

STREAM Capital Partners’ Jordan Shtulman and Jonathan Wolfe arranged the $7.4M sale of a retail net-leased property at 180 North Morgan St. in Chicago’s Fulton Market neighborhood to a private California-based investor. Federales, a bar and grill specializing in Mexican fare, holds a long-term absolute net lease at the location. This was the second time STREAM arranged a sale of this property. The first was when the owners of Federales executed a sale-leaseback in 2017.

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Essex Realty Group’s Jim Darrow, Jordan Gottlieb and Jordan Multack completed the $4M sale of 747 North May St., a renovated 22-unit building operating as an apartment hotel. Completely renovated in 2017, the property was sold by local real estate development firm City Pads to a local Chicago investor.

LEASES

Golub & Co. signed Chicago law firm Schoenberg Finkel Newman & Rosenberg to a 15K SF, long-term lease at The 300, a 536K SF tower at 300 South Wacker Ave. in downtown Chicago. Golub acquired the building in 2017 and recently finished a renovation, which added a new lobby and two-floor, indoor-outdoor amenity area. SFNR will move its headquarters from 222 South Riverside when the new lease starts in September, and occupy the entire 15th floor. Golub’s Deborah Frank and Sandy Macaluso represented Golub, and Colliers Internationals’ Tony Karmin and Corby Marx represented SFNR.

Becknell Portfolio Email
4850 Indianapolis Road, Whitestown, Ind.

FINANCING

JLL arranged a $319M recapitalization and $210M financing for a 33-building, Class-A, logistics portfolio totaling 4.1M SF across the Midwest. The company worked on behalf of Becknell Industrial on the recapitalization with Starwood REIT. Becknell retains an ownership stake, along with SREIT, and JLL placed for the new partnership a 10-year, $210M CMBS loan with a global investment bank.

JLL officials said the institutionally developed portfolio is 98% leased. Nineteen buildings are in the Chicago metro area, eight are in the Indianapolis area and three each in the Columbus and Milwaukee metro areas. JLL’s Kurt Sarbaugh, Robin Stolberg, Michael Joseph and Dominic Espinosa represented Becknell in the sale, and the team representing the new joint venture owner included Ken Martin, Alex Witt, Troy Shiley and Nelson Almond.

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Associated Bank completed a $33M loan to Bluepoint 94 LLC for construction of a 590K SF industrial building in the Stateline 94 Business Park in Pleasant Prairie, Wisconsin. When it is completed in July, global healthcare company Fresenius Kabi will occupy the building. Venture One Real Estate and CRG formed Bluepoint 94 as a joint venture, with Clayco providing design-build services. The Chicago-based Venture One now owns and manages more than 7M SF in corporate business parks in the Chicago metro area. Associated Bank’s Elizabeth Hozian handled the loan arrangements and closing.

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Cambridge Realty Capital Cos. provided a $7.6M HUD Lean loan to refinance Pontiac Supportive Living, a 60-bed supportive living facility in Pontiac, Illinois. Cambridge’s Jeffery Davis said the fully amortized, 35-year loan was provided for the owner, an Illinois limited liability company using the HUD Section 232 pursuant to Section 223(f) funding program.  

Fulton East
Fulton East

CONSTRUCTION AND DEVELOPMENT

Parkside Realty topped off Fulton East, its 12-story, 90K SF glass-and-steel office and retail building at 215 North Peoria St. in Fulton Market. Chicago-based Clayco leads the design-build effort with its in-house architecture firm, Lamar Johnson Collaborative. The developer said it will have the property ready for occupancy in June.

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Global architecture firm Goettsch Partners celebrated the groundbreaking for Union Station Tower, also known as BMO Tower, a new 50-story office building in Chicago. GP serves as the architect for the 1.5M SF project, developed by Riverside Investment & Development and Convexity Properties. Montreal-based BMO Financial Group will anchor the tower, located directly south of the 1925 Union Station building. 

THIS AND THAT 

Puerto Rico-based alternative asset manager The Convergence Group acquired Chicago-based Foresite Realty. The Convergence Group has administrative offices in Colorado, and focuses on matching talent and capital through private equity, private credit, real estate investment and healthcare venture development. The Chicago-based Foresite is a full-service real estate company that handles office, industrial, retail, hospitality, residential, multifamily, student housing and mixed-use properties in the Midwest, Mid-Atlantic and Southeast. 

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Evanston-based architect Nathan Kipnis expanded beyond his Chicago-area base by opening a new office in Boulder, Colorado, the city where he began his career. A principal at Kipnis Architecture + Planning, Kipnis earned his degree from the University of Colorado, Boulder, in 1983, and designed his first green residence there. He later made sustainable architecture and design a hallmark of his professional life. Kipnis said Boulder residents have shown a great deal of interest in green buildings, and decarbonizing homes in the face of climate change will be a major focus of the new office.