CRE Midwest

Group of investors acquires John Hancock Center offices

The office and parking components of the John Hancock Center, the 100-story landmark skyscraper anchoring the north end of Chicago’s skyline, was sold Wednesday to a group of investors including The Hearn Co., The Lynd Co. and Mount Kellett Capital Management LP.

[caption id="attachment_24234" align="alignright" width="150"]Stephen Hearn Stephen Hearn The office and parking components of the John Hancock Center, the 100-story landmark skyscraper anchoring the north end of Chicago’s skyline, were sold Wednesday to a group of investors including The Hearn Co., The Lynd Co. and Mount Kellett Capital Management LP. Financial terms of the transaction were not disclosed.

Hearn and its partners are purchasing the 900,000-square-foot office sector (floors 13-41), the 710-car parking facility (floors 4-12), and most of the common areas including the outdoor plaza, concourse and the entries and lobbies on both Chestnut and Delaware streets. The remaining components – retail, observatory and antenna – have already been acquired by other third parties. In 1973, the residential portion of the property was vertically separated and converted to condominiums.

“We are very excited about this acquisition," said Stephen Hearn, president and CEO of Hearn. "I believe that we possess the necessary talent, experience, resources and operational know-how to preserve the iconic status of the John Hancock Center offices while delivering contemporary design and efficiencies that will bring a new vitality to the property.

"Our redevelopment program will convey a fresh, exciting and youthful platform to this historic and architecturally significant Chicago landmark.  The John Hancock Center is a staple of the city and we will work diligently to advance the property.  We recognize the profile of creative and technology firms that have recently populated the tower and we want to create a work environment in-step with their energy and enthusiasm.”

“We are pleased to be partnering with Hearn and Mount Kellett on this important project,” said David Lynd, president and chief operations officer of Lynd. “We look forward to working together in advancing the John Hancock Center offices to its next important stage of development and growth, while preserving its historic roots and tradition.”

Designed by Skidmore Owing and Merrill architect Bruce Graham and engineering partner Fazlur Khan, the John Hancock Center is a 3.1 million-square-foot multi-use tower that opened in 1970 and became famous for its “cross-beam” steel bracing design that eliminated the need for interior columns creating more efficient, unobstructed interior space. In 2012, the building was vertically subdivided, creating multiple components, each of which has been subsequently sold.

The office portion is leased to a wide variety of users. Interpublic Group, leasing more than 320,000 square feet to subsidiaries Draftfcb, Golin Harris, Weber Shandwick and Octagon Worldwide, anchors the office portion of the asset.

The office floor plates, ranging in size from 36,000 square feet in the base to 29,000 square feet in the tower, accommodate larger tenants seeking open-plan offices, as well as smaller users such as financial and professional services.  Anchoring not only the skyline but the Magnificent Mile, The John Hancock Center is in close proximity to the CTA’s trains and busses, Michigan Avenue shopping and the Gold Coast neighborhood and beaches.

J.F. McKinney & Associates has been selected to lease the office space. The leasing team will be led by Jack McKinney Sr., Jack McKinney Jr. and Matt Lerner.