Chicago developer Sterling Bay is looking to sell development land in the high-demand neighborhood for the third time this year.
CBRE brokers are seeking a buyer for a big, high-profile site at 1200 W. Carroll Ave. and smaller nearby parcels on behalf of Sterling Bay, according to a marketing brochure.
Sterling Bay in recent years has planned a 14-story, nearly 500,000-square-foot office building on the site.
The firm has been one of the primary drivers of Fulton Market’s rise to become the country’s fastest-growing urban office market in recent years, including Sterling Bay’s deals to bring McDonald’s global headquarters and Google’s Midwest headquarters to the once-gritty area west of the Loop business district.
As longtime meat-packers and other business owners have sold their low-rise buildings to developers, the area has experienced a construction boom that also has brought new shops, residential towers, hotels, restaurants and entertainment.
But Sterling Bay now has its hands full trying to revive the stalled, $6 billion Lincoln Yards megadevelopment on the city’s North Side, where the firm is seeking new investors to replace J.P. Morgan Asset Management and Lone Star Funds. Sites near Lincoln Yards also have been put up for sale.
Sterling Bay’s attempt to sell 1200 W. Carroll follows two similar moves this year with its longtime development partner in the fast-expanding neighborhood as part of a broader sell-off of Chicago properties by J.P. Morgan Asset Management.
A Sterling Bay spokeswoman said J.P. Morgan Asset Management is not involved in the Carroll property now hitting the market.
J.P. Morgan Asset Management already this year has sold a 198-unit apartment building outside the neighborhood at 850 N. Lake Shore Drive for nearly $80 million to Miami-based Crescent Heights, taking a huge loss from the previous owner's $140 million purchase price in 2016. CoStar News first reported earlier this month that J.P. Morgan Chase also has a deal to sell the 227-unit Parker Fulton Market apartment tower on the eastern edge of the former meat-packing district to a venture that includes former Blackstone real estate executive John Schreiber.
Efforts by Sterling Bay and J.P. Morgan Asset Management to sell off Fulton Market sites come as the area thrives relative to Chicago’s downtown only a few miles to the east. But it also comes as property values throughout the country have been pushed down by factors including high interest rates.
The firms’ site at 345 N. Aberdeen St., which has zoning approval for 559 apartments, went up for sale in January. A neighboring site at 370 N. Carpenter St., zoned for a 390-unit multifamily tower, hit the market last month.
“The sale of this property is normal course of business for us as one of the most active real estate firms in Chicago,” the Sterling Bay spokeswoman said in an emailed statement. “Our business is predicated on identifying opportunities and bringing a vision to life that adds value to both our investment and the great city of Chicago.”
She added that “with entitlement secured at 1200 W Carroll, we feel it’s the right time to exit the property.”
In the latest move, three parcels totaling 101,066 square feet are available, including 59,952 square feet at 1200 W. Carroll, according to CBRE materials. Smaller parcels are at the southeast and southwest corners of Racine Avenue and Kinzie Street. CBRE describes it as a “blank canvas development opportunity to acquire a substantial piece of Chicago’s fastest growing and strongest submarket.”
Sterling Bay has owned the 1200 W. Carroll site since paying almost $22 million in December 2018, according to CoStar data.
A big, neighboring site at 1300 W. Carroll where Sterling Bay plans nearly 1,000 units in two apartment towers, is not part of the offering.
For the Record
The sellers are represented by CBRE brokers Tom Svoboda, Dominic Soltero and Larry Goldwasser.