Acquisition of Art Deco Building in Chicago

Industry

Real Estate/

Financial Services

Company Type

Real Estate Acquisition

Location

Chicago, IL

Size

$27 million

Investment Type

Debt/

Equity

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Helping Great Companies Grow

Overview

Rebar Capital is seeking $27 million of preferred equity and debt to acquire a 126,000 SF, 24 story office building at 105 W. Madison in Chicago’s central business district (the Loop) – Rebar Capital will contribute $1 million of equity.

  • 97.5% occupancy
  • Built in 1928 and renovated in 2017 – designed by the architectural firm of Burnham and Burnham
  • Located at the corner of Madison and Clark – convenient to City Hall, Daley Center, Thompson Center, the County Building and LaSalle Street Financial District
  • No major Capex expected
  • Rents are 15-20% below-market – most turning in next five years
  • Rebar Capital specializes in commercial real estate investments and management
    • founded in 2011
    • led by Ken Mulford – 31 years in credit, securitization ($500+ billion in issuance), loan origination, and capital markets
Helping Great Companies Grow

Opportunity

  • Strong operating history
  • Charming art deco building with incredible natural light and views of Lake Michigan
  • Art deco canopy and stone carving bordering the windows
  • Little to no tenant concentration risk
  • Prime location at Madison and Clark
  • Property is adjacent to one of the busiest court complexes in the US
Helping Great Companies Grow

Solution/Strategy

  • In year one, annualized rents rolling off amount to $437,442 (13.7% of current gross potential rent)
  • Company believes there is room to push rents as they roll, and remain below-market to maintain high occupancy rate
  • $3.8 million of recent capital improvements
    • remodeling of most offices
    • elevator modernization
    • new sprinkler system
    • new fire alarm system
    • common corridors, bathrooms
    • tuckpointing
    • new building automation system
Helping Great Companies Grow

Management

GS

Gene Staples,

Managing Member, Austin Affiliates LLC

CRE professional with over 20 years of industry experience. Primary focus is on value-add properties, emphasizing in-depth due diligence in property selection and extensive hands on management practices. Hands-on management style, leveraging economies of scale among projects and developing aggressive local marketing plans tailored specifically to each property, driving occupancy, minimizing expenses, and maximizing investor returns. Currently oversees a regional real estate portfolio that consists of over 500,000 SF of office-industrial space in the Greater Chicago/Northern Illinois area, re-development of a substantial urban infill project which when completed will contain over 150 new multi-family units and 30,000 SF of flex space, in addition to providing consulting services to the wireless telecommunications industry. Additional consulting experience:

  • Exelon Corporation as Senior Member of the Real Estate department at, one of the Nation’s largest electrical utilities, where he was in charge of infrastructure access and asset management
  • Dynis Inc. as Regional Director of Real Estate and Operations contract work for AT&T Wireless
  • Nextel Communications as Senior Project Manager for Real Estate & Network Development
  • 10Sixty Telecom Solutions as V.P. of Engineering-Real Estate
KM

Ken Mulford, CFA

CEO

31 years of experience in credit, securitization ($500+ billion in issuance), loan origination, and capital markets. EVP: mortgage companies, investment banks. Managed bank financing relationships with over $13 billion of exposure at peak. Master’s: Columbia University in the City of New York (1992), President’s Fellow; Bachelor’s: College of Wooster (Wooster, Ohio) (1985), Honors

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CONTACT US

Hi. We're not around right now. But you can send us an email and we'll get back to you, asap.

Thanks, Ken

Ken Margolis | Managing Partner Castle Placement, LLC
1460 Broadway Street, Rte 400
New York, New York 10036
(212) 418-1188 | C: (516) 712-7784
kmargolis@castleplacement.com

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