Beacon JV Acquires $100M Chicago Loop Office Tower
- May 19, 2014
Beacon Investment Properties L.L.C., in a joint venture with Harel Insurance, Investments and Financial Services Ltd, of Tel Aviv has bought a 23-story office tower in Chicago’s West Loop from Monroe Acquisition for $100 million.
Florida-based Beacon and Harel acquired the 535,911 square-foot high-rise as a value-add investment opportunity. The average in-place rental rate of the 91 percent-leased high-rise is below market, according to the news release.
The deal was handled by Jeff Bramson and Jaime Fink, senior managing directors and Mark Katz, managing director in the Chicago office of HFF, who represented the seller.
Built in 1973 and renovated in 2006, 200 West Monroe is located in the center of the West Loop, Chicago’s quickest growing submarket. The property has a contemporary two-story lobby and a 33,528 square foot Equinox luxury fitness center and spa that’s unmatched by any other facility in the Loop; all tenants are offered a discounted corporate membership. There are also two food purveyors on the premises. The 28,000- square foot floor plate accommodate full floor and multi-tenant users. Select Hotels, a division of Hyatt Hotels is the largest tenant.
“200 West Monroe’s location in the West Loop, the most appealing and sought after submarket in the Chicago CBD was the main attraction. Plus, we got it an off-market buy, at a cap rate close to an 8. It had or has the opportunity to increase rents as leases expire and it had some vacancies we can fill at market rates,” Brian Rosen, managing director, acquisitions for Beacon Investment Properties told Commercial Property Executive.
The buyer is seeking out additional Loop and suburban Loop office properties.
“Beacon is very bullish on the Chicago office market. We’re seeing more foreign investment coming into the city. Our partner on 200 West Monroe, Harel Insurance, Investments and Financial Services Ltd. of Tel Aviv, has continued interest in the city,” Rosen added. “In talking with the CRE community, they tell me they haven’t seen this kind of strength in Chicago in a long time. As long-term investors and aggressive buyers, we’re looking for more properties right now.”