General Growth Properties has acquired a 126,000-square-foot retail building in the heart of Chicago’s “Magnificent Mile” shopping district from Grosvenor Americas.
Located at 830 North Michigan Ave., the building wasn’t listed for sale, but Grosvenor Americas was presented with an offer that was too good to pass up. It had owned the building since 1993.
“We received an unsolicited offer to purchase from a very credible owner that was compelling,” Michael Beattie, Grosvenor Americas’ chief investment officer, told Commercial Property Executive. “Our strategy is to create value through our understanding of cities and where our investment in property fits. This sale allows us to realize value and redeploy funds in other markets that are the growth stage of the property cycle.”
In addition to the 830 North Michigan Ave. property, GGP has had a busy quarter. It acquired an interest in Apple and the Bulgari flagship stores in the prime Union Square retail district in San Francisco and closed on 200 Lafayette St. in the SoHo neighborhood in New York City.
“We set our mission to own high-quality retail assets, and today, our exclusive U.S. portfolio is of the highest quality,” Kevin Berry, GGP’s vice president of investor relations, said in the company’s 2013 Earnings Call on Friday. “We’ve matched the quality of our portfolio with a well-laddered maturity profile of our debt and has significantly mitigated the impact to our earnings from changes and interest rates.”
Originally constructed in 1947 and renovated in 1994, the building is part of the prestigious “Magnificent Mile,” a stretch of North Michigan Avenue between the Chicago River and Lake Shore Drive, which holds 460 stores, 275 restaurants, 23,000 hotel rooms in 60 hotels, five unique museums and entertaining attractions, and prestigious educational and medical facilities.
According to Beattie, its prime location just north of the historic Water Tower is matched only by the prominence of its tenants. Currently, the building’s tenants include London-based international fashion-forward apparel retailer Topshop, which occupies 50,000 square feet on four levels, as well as Columbia Sportswear and Ghirardelli Chocolates.
Grosvenor still owns two other properties in the Chicago metropolitan area: Rice Lake Square in Wheaton and Church Street Plaza in Evanston.