A New York-based investor that recently sold off a sprawling retail portfolio throughout the Chicago area is now looking to shed a small office property in the city’s River North neighborhood.
DRA Advisors has hired JLL brokers to seek a sale of the six-story office and retail building at 1 E. Erie St., according to a brochure. The offering includes a connected, 208-space parking garage at 10 E. Ontario St.
The New York investor and local partner M&J Wilkow bought the property for $47.9 million in 2016, according to Cook County property records and CoStar data.
It’s not clear how much the firms, which did not immediately respond to requests for comment from CoStar News on Tuesday, are expecting in a sale.
It is hitting the market at a challenging time to try to cash in on an office property, with many owners handing back properties to their lenders or taking big losses in sales amid continued low demand.
But some smaller properties in good locations such as River North or with multiple forms of revenue have overcome broader market challenges, including Next Realty’s recent refinancing of the Kingsbury Center boutique office and retail property at 350 W. Hubbard St. Chicago-based R2 has said it is seeking out smaller office properties that are generating cash flow, including its recent purchase of a six-story building at 303 W. Erie St.
The property at 1 E. Erie is 75.5% leased, according to the JLL materials. The property “offers durable in-place cash flow from the high-performing public parking garage and significant value-add upside from the ground-level retail tenancy,” the brochure says.
Built in 1983, the 127,750-square-foot property is at the base of the 51-story Ontario Place condominium tower, which is not part of the offering.
M&J Wilkow and DRA Advisors refinanced the property with a $37.35 million loan from Fifth Third Bank in February 2022. The loan was set to mature this February, with two options for one-year extensions, according to online property records.
DRA is a longtime investor in Chicago real estate, but the firm in recent years sold off retail properties throughout the city and suburbs that it acquired in a $2.3 billion takeover of Inland Real Estate Corp. in 2016. In one of the final sales, local firm North American Real Estate in May bought the fully leased Point at Clark building on the city’s North Side.
For the record
The sellers are represented by JLL brokers Jaime Fink, Bruce Miller and Sam DiFrancesca.