John Buck plans to develop a $77 million apartment tower in New York, the first out-of-town project for the Chicago developer’s opportunity fund.
The 193-unit building will be located at East 92nd Street and First Avenue, a couple of blocks from Gracie Mansion, the mayoral residence on Manhattan’s fashionable Upper East Side.
The 33-story project is the first step toward broadening Buck Co.’s focus to other markets. Washington, D.C., is also in the company’s sights.
The New York development, which will require an equity investment of up to $20 million, will probably be the next-to-last deal financed by Buck’s first $88.6 million opportunity fund, which was put together in 2000, said Charles Beaver, a Buck Co. principal.
The firm has already started raising more than $250 million for a second fund, with $100 million pledged by Teachers’ Retirement System of the State of Illinois.
The New York development, expected to be completed by late 2004, will be a joint venture with New York real estate firm Madison Equities, which assembled the site and retains a minority interest. The Buck Co. fund will receive a preferred return of profits.
Insignia moves: To spend more time on client services, Michael Klein, 39, is stepping down as head of the local office of Insignia/ESG Inc., but will remain with the New York-based firm.
Sam Delisi, 45, formerly the executive managing director of property services, will replace Klein as Midwest executive vice president, in charge of Insignia offices here and in St. Louis.
Klein will become an executive managing director and co-leader of the office brokerage group with Todd Lippmann.
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Bell Boyd stays put: After testing the market on a possible move, Bell Boyd & Lloyd LLC has signed a letter of intent to renew its lease at Three First National Plaza, 70 W. Madison St., almost four years before expiration, said John T. McCarthy, chairman of the Chicago-based law firm.
A new 15-year agreement, to take effect in January, would expand the law firm’s space by more than 10 percent, to 170,000 square feet. Draper & Kramer Inc. and Julien J. Studley Inc. represented the law firm in negotiations with the Hines Co. of Houston, co-owner of the 1.4 million-square-foot building.
Michaels warehouse: Irving, Texas-based Michaels Stores Inc. has retained Colliers, Bennett & Kahnweiler Inc. to advise it on the search for a new 700,000-square-foot distribution center, after a strong competition for the assignment among several real estate firms.
The search is expected to focus on the western and southwestern suburbs, said David Kahnweiler, president of the Rosemont-based firm.
Michaels, an arts and crafts retailer with 759 stores in North America, doesn’t have such a warehouse in the Chicago area.
Toulabi deal: Chicago restaurateur and real estate investor Reza Toulabi is set to close this week on the purchase of the former home of printer Bowne & Co., 325 W. Ohio St., which Lake Forest-based Svigos Asset Management LLC acquired this summer for $8.75 million.
Toulabi, founder of Reza’s restaurants at 432 W. Ontario St. in River North and on Clark Street in Andersonville, will pay about $9.5 million for the 105,000-square-foot loft building and an adjacent lot, sources said.
Included are plans for 200 residential units on the site, said Frank Diliberto, senior vice president of Oak Brook-based Inland Real Estate Corp., which represented first Bowne and then Svigos.
Hotel recovery? The worst may now be over for the area hotel market, which continued its slow decline this year after seemingly hitting bottom during the first quarter, according to a report by Property Valuation Advisors Inc. and Smith Travel Research.
“That turned out to be a false bottom,” said Brian Flanagan, president of Chicago-based Property Valuation. “But now, we’re seeing signs of the early stages of a recovery.”
Occupancy rates and room charges fell sharply during the first quarter but have begun to rebound.
During the first three quarters, the occupancy rate downtown declined slightly, to 65.1 percent, while the average room rate dropped 6 percent, to $145.42 a night, compared with the same period in 2001.