Chicago Commercial Real Estate Pulls In High Prices

As announced in the Chicago Tribune earlier this week, a new office tower being built at 111 S. Wacker Drive in chicago's Loop has been put up on the market for a staggering $375 per square foot. If this advertised price is met, it would be the greatest paid since 1990, while the realty market was most recently at its peak. And considering that the building has 1 million square feet of office space to offer, the office building as a whole would set a new high for largest total sales price.

The skyscraper is likely to reap in the top dollar it is asking for, with a highly respected group of tenants already lined up. Financial heavyweight Deloitte will inhabit 47% of the space through a 15 year term of a contract, and law firm Lord Bissell & Brook will also be setting up shop there.

The 111 S. Wacker place, being developed by John Buck, Co., is one of a few exciting new downtown Chicago commercial properties available. Two additional, more modest west loop office projects are also looking to outmatch the $300/sq. ft. mark. These stratospheric asking prices have some investors concerned that the realty market could be getting too hot again. Others maintain that real-Estate is being reassessed by the market, and that inherent values are increasing as realty begins to come more into line with other investments, including bonds and equities.