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CHICAGO-Boston-based First Union Real Estate Equity and Mortgage Investments and local office property operator Marc Realty LLC have teamed to buy the office and retail portion of 1 E. Erie St. The partnership paid $27 million to acquire the 128,000-sf commercial area from condominium developer and converter American Invsco.

In addition to the office and retail space, First Union Real Estate Equity and Mortgage Investments and Marc Realty LLC also acquired 208 parking spaces within the River North mixed-use building at the southeast corner of Erie and State streets. First Union Real Estate Equity and Mortgage Investments holds an 80% stake in the partnership, while Marc Realty LLC owns a 20% share.

Marc Realty LLC has borrowed from First Union Real Estate Equity and Mortgage Investments before, and the latter is financing the deal at 1 E. Erie St. with a $19.9-million mortgage at the prime rate to the partnership. However, First Union Real Estate Equity and Mortgage Investments officials say the partnership will likely refinance its acquisition soon. "We are excited about the opportunities that this investment provides us with and further strengthens our presence in the Chicago market and our relation with Marc Realty," says First Union president Peter Braverman.