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CHICAGO-Prime Group Realty Trust has retained New York City-based Carlton Advisory Services Inc. to arrange funding for its $318-million redevelopment of the former IBM Plaza at 330 N. Wabash. The owner plans to convert at least the lower 14 floors of the 47-story, 1.4-million-sf office tower into residential condos.
The conversion is aimed to exploit the City's thriving multifamily market and shifts that are bringing more residents Downtown. The mid-rise portion of the building will remain as office space, and the high-rise portion may either remain office or be converted to residential rentals or for-sale condos, depending on market conditions, according to a statement.
The building was designed by Ludwig Mies van der Rohe and completed in 1973. It is directly across from Trump International Hotel and Tower. According to published reports, condo units in the Trump asset are 75% pre-sold and the asking rate for condo space averages about $900 per sf.
According to Howard L. Michaels, Carlton's chairman, his company will arrange approximately $240 million of senior debt and either preferred equity on an 80/20 basis or mezzanine financing up to 90% of the cost for the redevelopment and conversion. Locally based Prime Group, an affiliate of the Lakewood, NJ-based Lightstone Group, has a portfolio in excess of 29 million sf that includes 12,000 multifamily units.
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