The Loop’s first office building since 2010 may come with white marble and Chihuly glass
J. Paul Beitler feels the need for speed. Beitler, one of Chicago’s most prominent developers over the last 30 years, has hatched a plan for an office tower whose modest scale he thinks will give him a competitive edge.
In partnership with Andrew Hochberg, chief executive of Next Realty, Beitler intends to build a 23-story tower at 200 W. Randolph, replacing a parking garage. The goal is to get it done fairly quickly, by early 2015. That would make it downtown’s first office building since 2010 and give it first crack at tenants that crave new space.
Beitler plans a few special touches, such as a white marble lobby and a sculpture by glass artist Dale Chihuly, but otherwise he has in mind a workaday structure. He said modesty is the new fashion with corporate tenants.
“Larger tenants we talk to don’t want to make a statement. They want a lower profile,” Beitler said, citing such as a examples as Google Inc. going into the Merchandise Mart and Hillshire Brands Co., part of the old Sara Lee, placing its headquarters in an old warehouse district at 400 S. Jefferson.
A smaller building could out-maneuver a giant by being easier to finance. “We’re coming out a period where capital markets have not fully rebounded,” Beitler said. “There is a reluctance on the part of lenders to take any risk on new development.”
If Beitler can hold to his timetable, he’ll be done with construction a year before a building at 444 W. Lake, which will be twice the size of the 400,000-square-foot 200 W. Randolph. Site work has started at the Lake Street site.
Beitler plans to build within existing zoning, except for seeking a “bonus,” a legal tradeoff that lets him build slightly more space in exchange for including a top-floor setback. It provides party space for a tenant, while increasing the light and air flow for the property next door.
The architect is James DeStefano of Lohan Van Hook DeStefano Architecture. DeStefano worked on the 131 S. Dearborn building that opened in 2003, Beitler’s most recent project downtown. Since then, his Beitler Real Estate Services has confined itself to property management and leasing while waiting out the recession.
If city officials sign off, Beitler and Hochberg plan to kick in $30 million in equity for the $140 million deal and secure tenants. Some are ready to sign, but want the building to get the city’s OK first, Beitler said.
Randolph Street has a couple more development sites available. Will Beitler take a run at them?
“Possibly,” he said, “but I have to walk before I can run.”
CALL OUT THE CRANES: Naperville-based Marquette Cos. has started construction on a 19-story apartment building at 630 W. Washington. The project is a joint venture with Hunt Cos. and Jayne Anderson Capital Advisors LP. The design by Brininstool & Lynch is due to be finished by mid-2014.
Construction of a Walmart Supercenter has started at 3600 W. Touhy in Skokie. The project by Clark Street Development is due to be finished in spring 2014.
DOING THE DEALS: Jones Lang LaSalle Inc. represented toymaker Tomy International in its lease of 24,000 square feet for a headquarters at 2015 Spring Road, Oak Brook. … NelsonHill represented Berkshire Refrigerated Warehousing LLC in its lease of 72,000 square feet at 1550 E. 98th St.
David Roeder reports on real estate at 6:22 p.m. Thursdays on WBBM-AM (780) and WBBM-FM (105.9). The reports are repeated at 10:22 p.m. Thursday and 7:22 a.m. Sunday.