Citadel Center, the 1.5 million-square-foot office tower located at 131 S. Dearborn Street in Chicago’s Loop, is reportedly seeking a buyer. The owners—a partnership between Angelo, Gordon & Co., a $32 billion alternative investment firm focused on credit and real estate investing, international real estate firm Hines and New York City-based real estate private equity and asset management firm Dearborn Capital Group—are seeking upwards of $750 million.
As reported in Crain’s Chicago, the HFF, which is finalizing a merger with JLL, is marketing the building to investors. If the property is able to fetch the price that the owners are seeking, it would quite a coup for Hines and Angelo Gordon, and signal a full turnaround for a once-troubled property.
The Hines/Angelo Gordon joint venture acquired a controlling interest in the property in 2016, putting $50 million of equity up against the more than $470 million in debt that the existing ownership faced. With the prospect of departing anchor tenants and the building’s namesake, hedge fund investment firm Citadel, shrinking its footprint, the building was appraised at the time for approximately $415 million—far below the $560 million that the existing owners paid 10 years prior. Following a recapitalization that extended debt maturities and shored up finances, the building was able to improve amenities and attract and retain tenants.
Last spring, Citadel signed a new, long-term lease to maintain their global headquarters at Citadel Center and tech firm Sprout Social expanded by 64,000 square feet on one of the buildings “mega” floors. Beer, wine, and spirits manufacturer Constellation Brands has 13 years left on their 132,000-square-foot lease. Flexible workplace and on-demand meeting services provider, Convene, now occupies 50,000-square-feet.
Designed by Spanish architect Ricardo Bofill, the 37-story office tower was completed in 2003. Tenant amenities at the Citadel Center include access to a 10,000-square-foot fitness center, building lounge and a rooftop deck featuring a bar and fire pits. Recent building renovations include a complete lobby renovation with destination dispatch elevators, security enhancements and a new, 180-seat conference center.
