Downtown office sales activity has been relatively quiet of late so even a deal in the eight figures like DRA Advisors' agreement to buy 1 East Erie in River North is enough to make waves.
DRA is paying $47.9M to Winthrop Realty Trust for the building, according to Crain's. Winthrop paid $27M for the asset in 2005. Any River North office asset that hits the market will attract bidders because of the submarket's low 10.1% office vacancy rate. What DRA loves about this deal is the ability to increase rent spreads to market rates and attract prospective tech and retail tenants to downtown's tightest office market. The 126k SF building is 22% vacant, so DRA and its partner in the deal, M&J Wilkow, will have their work cut out for them.
There was one downside to the sale that turned off some bidders. The building is at the base of Ontario Place condominiums, and DRA will have to share some decisions on redeveloping the building with the condo board. [Crain's]
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