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Angelo, Gordon Makes Another Foray Into Chicago

New York City Firm Closes on Presidents Plaza Near O'Hare for $147 Million
April 13, 2018
Angelo, Gordon & Co. has closed on another trophy property in a hot Chicago office market with the $147 million purchase of Presidents Plaza, the glimmering duo of 12-story office towers looming over the Kennedy Expressway, just east of O’Hare Airport.

The New York-based investment management firm picked up the 825,000-square-foot complex from a joint venture of PGIM Real Estate, a New Jersey-based investment firm, and GlenStar Properties, for nearly $125 per square foot. Chicago-based GlenStar, which leases the buildings, will stay on as the buildings’ leasing and managing service provider.

"Presidents Plaza is ideally located in O’Hare, which has emerged as Chicago’s strongest suburban submarket due to its direct access to downtown mass-transit and convenient drive times to the city’s residential neighborhoods," Scott Glassberg, Angelo, Gordon vice president, said. "Our purchase of Presidents Plaza underscores our commitment to investing in well-managed, Class A properties with first-class amenities."

The two 1980 buildings underwent their second updating since 2010 two years ago with a $15 million capital renovation that brought the towers up to date with new systems, lobbies and entrances, as well as the latest must-haves in office tower necessities: a 17,900-square-foot gym, a state-of-the-art conference center, café, hair salon and barber, convenience store, Wi-Fi-enabled tenant lounge and a full-service car wash. The last update was completed in 2011.

The properties, at 8600 and 8700 W. Bryn Mawr, are on the Park Ridge and Rosemont borders but have Chicago addresses - considered an important differentiator for tenants who prefer a suburban location, close to city and suburban residential areas, but want a Chicago address. The 8600 building has about 409,00 square feet of rentable space and is 97.2 percent occupied, while the 8700 building holds about 431,400 square feet of rentable space and is about 93.2 percent occupied.

Office vacancy in the O’Hare submarket is 14.3 percent, according to CoStar research, well below its historical average and the high teens and low 20s that nearby submarkets are experiencing. Last year was a strong one for O’Hare's absorption with a hoard of many mid-sized moves. That gave landlords some pricing power, pushing average rents about 5 percent above their prerecession peak to $24 per square foot. Class A properties, however, have seen the most growth in rents, up about 8 percent overall.

This isn’t Angelo, Gordon’s first foray into Chicago. The $28 billion alternative investment firm has a chunk of ownership in the Citadel Center at 131 S. Dearborn and 200 W. Jackson, as well as the Kmart in Avondale, which was purchased for $16.5 million, and a handful of industrial properties.

For the Record:

JLL Capital Markets’ managing directors James Postweiler and Peter Harwood led the JLL team handling the transaction.

Michael Klein, managing principal and co-founder of GlenStar Properties, also was involved in the deal.

For more information on the transaction, please see CoStar Comp #4208951.

Jennifer Waters, Chicago Reporter  CoStar Group   
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