Two Long Island-based investors known for buying distressed retail properties are upping their bet on big office towers in Chicago, striking a deal to buy a 40-story tower in the Loop business district after another buyer’s deal fell through.
Namdar Realty Group and Mason Asset Management have a preliminary deal to buy the building 798,782-square-foot building at 190 S. LaSalle St., according to people familiar with the situation.
The deal is preliminary and still could fall apart in a challenging market for financing office properties.
But the affiliated firms based in Great Neck, New York, have been known to pay all cash to complete large deals.
Although Namdar and Mason are best known for buying shopping malls and other retail properties out of financial trouble, the firms have increasingly been seeking out large office towers at what they perceive to be bargain rates years into weak office demand throughout the country.
The deal for 190 S. LaSalle comes after a Colorado-based buyer, Real Capital Solutions, backed off a deal to buy the property known for its green gabled roof.
Namdar and Mason previously pulled off a similar deal, buying the 57-story tower at 70 W. Madison St. after a Florida-based buyer failed to follow through on an agreement to buy it in late 2024.
The firms also previously acquired the 47-story tower at 1 N. LaSalle St. by buying the note on a matured loan and then seizing the property.
The combined price for those two Chicago towers was believed to be around $100 million.
Other Chicago deals in recent years by the firms include paying more than $23 million for a retail property on the Magnificent Mile.
Namdar and Mason also have an $8.3 million agreement to buy the retail portion of the tower at 1 N. State St., Crain’s Chicago Business recently reported.
In other office deals, Namdar and Mason in 2024 paid $45 million for the 45-story 200 Public Square tower in Cleveland.
The tower at 190 S. LaSalle is expected to sell for far less than the value of a $167.5 million loan that lenders including U.S. Bank provided to Beacon in February 2020, just before the onset of COVID-19.
Boston-based Beacon bought the tower for $230 million in late 2019.
The price for 190 S. LaSalle could not be determined. The buyers, Beacon Capital Partners and U.S. Bank, did not immediately respond to requests for comment from CoStar News on Monday. U.S. Bank also is a tenant in the tower.
Completed in 1987, the postmodern building was designed by architects Philip Johnson and John Burgee.
Beacon invested $13.6 million in renovations, according to a brochure from Cushman & Wakefield, which began marketing the property for sale in March.
New owners will face a big lease-up challenge to fill existing vacancies and the expected loss of big tenants such as Bain & Co., which is moving to 131 S. Dearborn St.
For the record
The sellers are represented by Cushman & Wakefield brokers Tom Sitz and Cody Hundertmark.