CHICAGO-Parsippany, NJ-based Prudential Real Estate Investors has closed on its purchase of 22 W. Washington, the 17-story office tower built on the grounds of the infamous Block 37 in the Central Loop area, for $183.5 million. The building sold by the joint venture that developed it, a partnership of New York City-based BlackRock and locally based Golub & Co.
Block 37 has had many years of bad luck for development, and that luck continued recently when Freed & Associates had to give up its rights to the retail mall built on the property due to lack of payment on a $173 million construction loan with Bank of America. The site, along with the new 439,434-square-foot office tower, was supposed to get a large new transportation hub built underneath, but those plans were shelved when the economy went south.
However, the office tower at the site has stayed full, and is about 99% occupied. Morningstar has a lease until 2023, and CBS has offices and a ground-floor studio, complete with windows to passers-by, until January 2033, sources say.
Catherine Marcus, managing director and portfolio manager for PREI, said in a statement that the building is a low-risk investment. “We believe 22 W. Washington is a perfect example of the kind of high-quality, core office property that is going to provide a stable cash return over the long-term for our investors,” she said in a statement.
Golub will continue to manage the office. Prudential, a divsion of Prudential Financial Inc., also an investor in the 37-story Left Bank apartment tower at Alta at K Station in the West Loop.
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