CRE Midwest

Beacon Investment Properties, UBS joint venture buys 20 N. Clark office tower

A joint venture between Beacon Investment Properties of Hallandale Beach, Fla., and an investor account advised by UBS Global Asset Management has acquired 20 N. Clark, a 35-story office tower in downtown Chicago’s Central Loop.

A joint venture between Beacon Investment Properties of Hallandale Beach, Fla., and an investor account advised by UBS Global Asset Management has acquired 20 N. Clark, a 35-story office tower in downtown Chicago’s Central Loop. The seller was a joint venture between the Multi-Employer Property Trust (MEPT), which was advised by Bentall Kennedy and Hamilton Partners of Chicago. Price was not disclosed.

Located on the northeast corner of Clark and Madison streets, the 393,094-square-foot Class B+ building, built in 1981, is currently 83 percent occupied.

“20 North Clark is a perfect fit for our portfolio strategy of acquiring Class B+ office properties with limited vacancies and making value-adding enhancements that repositions the building to Class A thereby increasing occupancy and returns,” said Ariel Bentata, managing member and a co-founder of Beacon.

“Our joint venture partnership plans to invest in improvements that will include a new conference center, fitness center, upgrades to the lobby, corridors and common areas,” he added. “We’re confident we can lease up the full floor vacant space in the upper half of the building at current Class A market rates.”

A spokesman for UBS said, “we believe that with its planned enhancements, and its location in the heart of the Central Loop, 20 North Clark will continue to attract quality tenants.”

The transaction is Beacon’s second investment in the Chicago market. A month ago, it acquired a 210,744-square-foot, four-story office building at 215 Shuman Blvd. in suburban Naperville.

“We’re committed to expanding our presence in Chicago,” Bentata said. “We’re currently evaluating additional acquisition opportunities in the CBD and welcome discussion of other off-market deals.”

CBRE’s Chicago office represented the sellers of both the suburban and downtown properties, working with a Beacon team headed by Brian Rosen, director of acquisitions.

“We knew Beacon was very interested in finding a high-quality, value-add investment downtown and from the day we presented 20 North Clark to them, they were 100 percent focused on buying it,” said Dan Deuter, senior vice president of CBRE Capital Markets.

CBRE executive vice presidents Paul Lundstedt and Mike Vesper of its Investment Properties Institutional Group were part of the sales team representing MEPT and Hamilton Partners. Ron Lakin and Rachel Waymire from CBRE’s Brokerage Services Group have been retained by the Beacon-UBS partnership to handle leasing for 20 N. Clark.

Acquisition financing – a four-year loan totaling 75 percent of the purchase price - was arranged by Susan Hill, senior managing director of HFFLP’s Houston office and provided by General Electric Capital Corporation.

“The technology sector, along with other professional services groups are moving their headquarters from the suburbs into downtown Chicago and we feel our 12,000-square-foot full-floor vacancies on floors 3, 18, 28 and the penthouse on 36 will be highly desirable because of our Central Loop location,” said Paul Gaines, asset manager of Beacon.