(Crain’s Chicago Business photo)
One of the biggest retail real estate deals in the history of Chicago went down last week when a British investor paid $295 million for a Michigan Avenue property that includes a five-story flagship Nike store. This is just the latest indication of a sizzling Chicago commercial real estate sector, as it comes on the heels of a report earlier this month showing downtown office sales in 2015 have already set an all-time record with more than a month remaining on the year.
According to Crain’s Chicago Business, the property was purchased by London-based real estate investment firm Meyer Bergman. The sale included three connected buildings that stand up to five stories at 663, 669 and 673 Michigan Avenue in the Magnificent Mile shopping district. There is a combined 148,245 square-feet of space, which equates to a sale price of $1,990 per square foot.
This is Bergman’s first real estate deal in Chicago, though it did earlier this year make its first foray in the U.S. with the purchase of a 7,500 square-foot Converse store in the Third Street Promenade in Santa Monica, Ca., Chicago Business reports. The deal for the Nike property is the fifth-highest price ever paid for a Chicago retail property, Crain’s noted. It is also the 21st highest-price paid for a retail property in the U.S. this year.
Crain’s Chicago Business pointed out the high cost paid for the Chicago property likely means “Meyer Bergman is taking a long-term view of the site, where it could eventually build taller structures to increase the property’s value.”
According Crain’s, the site is already zoned to add another 229,323 square-feet of retail space.
The seller of the property was the State of Investment Wisconsin Board, which was represented by Chicago-based Cushman & Wakefield.
Real estate observers were largely impressed by the deal, noting the property is a prime slice of Chicago retail real estate that is wonderfully located.