Transwestern announced 500 West Madison has secured leases totaling 73,000 square feet in December, bringing total leasing activity at the building to 145,000 square feet for all of 2014. Extensive capital improvements are underway on the 1.5 million-square-foot building in Chicago’s Central Business District which is now 95 percent occupied. Transwestern’s Michael Lirtzman, executive vice president, and Courtney Baratz, vice president, are the exclusive leasing agents for the building on behalf of the owner, KBS REIT III.
“KBS’s strategy to reposition 500 West Madison as a premier office address in Chicago through major capital improvements and new tenant amenities secures the building’s status as one of the most desirable office destinations in the city,” said Lirtzman. “The program paid off in 2014 with an increase in occupancy and a roster of top-quality tenants.”
In December, HERE North America, a division of Nokia, leased 8,559 square feet in its third expansion this year, increasing its occupancy in the building to approximately 58,000 square feet. Additionally, National Financial Partners Corp. signed a lease extension and expansion for a total of 36,000 square feet.
KBS REIT III acquired the 40-story building in late 2013. Over the past year, KBS has started a large-scale capital improvement and repositioning program, committing significant capital in 2014 and 2015 that includes upgrades to all of the building’s public spaces, including a new lobby and atrium, a complete renovation and modernization of the building’s food court and newly renovated restrooms and multi-tenant corridors. In addition, KBS is expanding the suite of building amenities to include a new tenant lounge on the lobby level, an expanded and improved conference center and a new 11,000-square-foot fitness center with a basketball court.
“KBS has taken an active asset management approach to 500 West Madison because we view it as one of the top trophy properties in Chicago,” said Brett Merz, senior vice president of Asset Management at KBS. “Our investment in upgrades and amenities are helping to bring the building up to the level of quality that it deserves and will significantly improve bottom-line performance to the benefit of KBS REIT III’s shareholders.”
