Purchasing downtown office space, as opposed to renting, is relatively unusual, but Lisa Davidson and James Stein of Studley say that for some users it makes sense. As reported in GlobeSt.com, the two have just finished representing, for example, the Taipei Economic and Cultural Representative Office in the US in its purchase of 20,315-square-feet within 55 W. Wacker in Chicago. The consulate, which will relocate this spring from its current offices atop Two Prudential Plaza at 180 N. Stetson in Chicago, serves Taiwanese citizens in the Midwestern US and represents the interests of the Republic of China, also known as Taiwan.
“When you own, it’s more difficult to have the flexibility you need if you decide to expand or contract,” Davidson tells GlobeSt.com. “But for a consulate, their needs are relatively static, so the lack of flexibility does not have the same importance.” In DC and New York, the Taipei offices own their property as well, and “it is their investment philosophy that it is better to own rather than rent.”
“It’s very common for tenants to consider buying a downtown office space,” but due to a lack of available space to buy, she adds, “they usually find out that this means that they can’t be in the Central Loop and will probably end up in a smaller building with office space on five floors.” At 55 W. Wacker, Taipei purchased the 13th floor and a portion of the 12th floor.
MB Real Estate leases and manages the 209,000-square-foot, 15-story property. Constructed in 1968, the class B building features 14,250-square-foot floor plates which users can lease or own.
“This is a space which checked all the boxes for what they needed,” says Stein, including “great views, in this case of the river, and security.” Furthermore, other than 111 W. Illinois St. and a few other buildings which offer office space for sale, “there are just not a lot of opportunities like this.”
“Our firm has worked with a number of consulates over the years,” he adds, and it’s difficult to identify common traits, since each represents governments with different attitudes toward diplomacy and different spending priorities.
However, Davidson says she “wouldn’t be surprised if in the future we saw more consulates looking at ownership.”Office Buyers Have Few CBD Opportunities
Related StoriesTaiwan Reps Buy Part of 55 Wacker
Building Sales Impact Rent Trends