CHICAGO—Sterling Bay has made itself into one of the city's most important developers. It will soon open the new global headquarters for McDonald's in the West Loop, one of several company projects transforming the office landscape and helping create new submarkets. And its latest move, the $510 million acquisition of the mammoth riverfront headquarters of Groupon at 600 W. Chicago Ave., will also bring changes to the city.
“This is the type of asset we can see ourselves holding long term,” Keating Crown, a Sterling Bay principal, tells GlobeSt.com. The large floor plates of the approximately 1.65-million-square-foot former warehouse are highly sought after by tenants that want to locate all of their employees on only one or two floors. The property is already 94% leased. In addition to Groupon, tenants include Echo Global Logistics, Uptake Technologies, Jump Trading, Big Ten Network and venture capital firm Lightbank.
But Sterling Bay wants to do more than just collect the rent. In addition to renovating the lobby and other common areas, it will transform how neighborhood residents and passersby interact with the building, located on the east side of the Chicago River's North Branch.
“I think the river in the past has been an unappreciated asset,” Crown says. But the Riverwalk, a series of recreational spaces downtown along the Chicago River, now stretches from the lakefront to Lake St. and has become a real destination, packed with retail, attractions and throngs of visitors.
The company is in the early stages of its own plans, and obviously won't have anything as elaborate as the Riverwalk, but Crown says the building's waterfront location can help it be a destination for the neighborhood's thousands of new residents. He also envisions new retail, which could include something like a coffee shop, or boutique grocery store, or another high-end outlet.
Those working in the building should also start to see changes, and not just to the interior. Crown says Sterling Bay will make it easier for them to ride to work on bikes, use ride sharing, and eventually, autonomous vehicles.
That last idea is certainly another indication Sterling Bay plans on keeping this property in its portfolio for some time. The acquisition boosts its presence on the North Side, where it is also building the massive new Lincoln Yards development. That 70-acre site, just to the north in Lincoln Park and Bucktown, also stretches along the river, and is one of the few sites in the nation still considered a possible future home for Amazon's HQ2.
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
