Dutch banking giant ABN AMRO is focusing on two possible sites for a proposed North American operations center.
The parent of LaSalle Bank, which was considering as many as five locations, has signed options on both sites, which are just west and south of the Loop, sources said. The two locations are
– A 2.8-acre site along Clinton Street between Washington and Madison Streets. The site is owned by Sunbelt Management Co., a Florida-based firm controlled by the family of German billionaire Hugo Mann.
– An 8-acre site along the east bank of the Chicago River, just south of the Eisenhower Expressway, called Franklin Point, owned by Richmond, Va.-based CSX Corp.
The two sites present much different development alternatives for a project that could be up to 1.3 million square feet. The bank’s development team includes Houston-based developer Hines Interests LP and Chicago-based architectural firm DeStefano and Partners.
An ABN AMRO spokeswoman would not comment.
The South Loop site is large enough to accommodate a suburban-style office campus with a river walk. The smaller West Loop site, next to the Ogilvie Transportation Center, would likely be a complex of office towers.
And costs are a consideration for ABN AMRO, which is in the midst of restructuring. The price tag on the Sunbelt site is about $45 million, or about $12 million more than the CSX site, sources said.
Verizon store: With plans to open a store in time for the holiday shopping season, Verizon Wireless has signed a lease for a 1,742-square-foot, street-level store at 500 N. Michigan Ave., said Thomas Grace, vice president with PM Realty Group Inc., which manages the property for an overseas investment group.
Verizon will replace a Grandma Gebhard’s bakery, which closed in February, and a 400-square-foot American Airlines ticket office, which has been on a monthly lease since April.
Ontario Place sold: The California Public Employees Retirement System has closed on its acquisition of Ontario Place, a 470-unit high rise in River North. The Chicago office of Eastdil Realty Inc. represented the pension funds that sold the 50-story building at 10 E. Ontario St. The transaction is valued at $105 million.
Meanwhile, Chicago-based U.S. Equities LLC has taken over management of the building’s 120,000 square feet of commercial space, which was about 66 percent leased. But two tenants have already signed leases totaling 22,000 square feet of space.
Downtown demand: The demand for downtown office space continues to surge, with vacancy rates dipping to 8 percent during the third quarter, compared with 8.3 percent in the previous quarter.
The vacancy rate is the lowest since at least 1990, according to a report by the Chicago office of CB Richard Ellis Inc.
“The demand for space is a crusher, there’s just no room left,” said John Dempsey, senior vice president with CB Richard Ellis Inc.
The report does not include space available for sublease, which increases the market’s wiggle room.
Nearly 640,000 square feet of office space was absorbed during the quarter, bringing the year-to-date total to more than 2.5 million square feet. (Net absorption is the change in the amount of space leased and occupied.)
At that rate, this year’s absorption could top 1998, when 2.9 million square feet of space was absorbed, the highest total in a decade.
Meanwhile, suburban vacancy of 9.8 percent is virtually unchanged from the second quarter, when it was 9.6 percent.
OFFICE VACANCY RATES
%% 2Q 3Q
West Loop 5.3% 5.4%
East Loop 11.3% 11.7%
Central Loop 9.1% 8.2%
North Michigan 7.6% 7.6%
River North 3.2% 3.6%
Downtown total 8.3% 8.0%
%% CB Richard Ellis Inc.
