Clear Height Properties and its joint venture partner Buligo Capital Partners have sold an Oak Brook office property in a transaction that demonstrates the opportunity some investors see in recently renovated suburban office assets that also contain some vacancy.
Chicago-based real estate investor Helios Properties acquired 814 Commerce, a three-story, 173,017-square-foot office building from the Clear Height-lead joint venture. The partnership had acquired the building in late 2019. The suburban office capital markets team from Cushman & Wakefield, led by Dan Deuter, represented the Sellers.
Since the building’s acquisition in late 2019, Clear Height invested substantial capital to modernize and upgrade 814 Commerce. Of the $1.5 million invested, the most notable and extensive improvements were made to the building’s exterior and common areas, parking deck and HVAC systems. The improvements made at 814 Commerce were designed to revitalize the asset and create an image of quality that would differentiate it from other competitive buildings in the immediate vicinity.
At the time of its disposition the property was 56.1% leased to three tenants including Innovista Health Solutions, IRC Retail Centers and CPS. 814 Commerce has a unique combination of small block and large block availability, suitable for all tenant sizes. The available space ranges in size from 1,438 square feet to a single continuous block totaling approximately 45,722 square feet.
“Our investment thesis, to acquire a well-located asset like 814 Commerce, give it the attention required to better position it for the marketplace, and then conduct an aggressive lease program, remains incredibly viable,” said Gary Rose, President and COO of Clear Height Properties. “Helios recognizes and embraces that strategy and is now in a position to create additional value for the property.”
Dan Deuter, Executive Managing Director, Capital Markets, Cushman & Wakefield, added that several critical factors all came into alignment to position 814 in the market.
“814 Commerce is an AA located building that also offers tenants a great value proposition,” he said. “The improvements that were made by Clear Height and Buligo helped to establish the building as a viable option in the flight to quality and value being experienced by companies looking to improve and safeguard the workplace experience as they move toward getting back to the office.”
Deuter said the combination of these factors created a competitive environment in the marketing of 814 Commerce which ultimately resulted in a relatively quick closing.
The Cushman & Wakefield Capital Markets team included Deuter; Michael Simpson, Executive Managing Director; and Paul Lundstedt, Vice Chairman.