Keep an eye on Evanston, where the office building sector is showing signs of activity. Hot on the heels of Steelbridge Capital's $18M acquisition of 500 Davis St comes word that another formerly distressed office building is on the market.

A JV of The Farbman Group and Lubert-Adler Partners has placed 1007 Church St up for sale. The JV paid $9.6M for the defaulted loan on the Helmut Jahn-designed building two years ago, according to Crain's. It was previously owned under a tenant-in-common partnership, TIC Group, which paid $27M for the asset in 2007. As cash flow evaporated during the real estate bust, the group was hit with a foreclosure lawsuit.

The building had a 49% vacancy rate when the Farbman/Lubert-Adler JV assumed control; it's now at 21% and the JV upgraded lobby and common area amenities. HFF, which is courting bidders for the 156k SF building, says there are several upsides to a deal. Rents are well below market value, which means a new owner has the ability to significantly increase revenue. An adjacent parking lot can be redeveloped to add another 149k SF of office space. Bids on the property could reach $29M, a hefty ROI for the Farbman/Lubert-Adler JV. [Crain's]