The former Sports Authority site in River North could be redeveloped as a 17-story office project—unless the vacant eight-story building is rehabbed sooner for a less-patient tenant.
The vintage 80,000-square-foot building at LaSalle and Ontario streets, which Skokie-based Next Realty has owned since 2002, has been empty since Sports Authority liquidated last summer. It was once the anchor location of the Morrie Mages Sports chain.
“We are continuing to go down the path of adaptive reuse,” said Marc Blum, Next Realty’s president and chief operating officer. That scenario would allow occupancy by mid-2018. A build-to-suit would take about six months longer, he said.
As Crain’s has reported, sophisticated institutional investors like Goldman Sachs are investing in brick-and-timber structures as boutique office buildings are converted to other uses.
River North’s fourth-quarter office vacancy rate of 7.7 percent, off 0.1 point from the year-earlier period, is the lowest among downtown Chicago submarkets, according to CBRE Group, which is seeking tenant prospects for the Sports Authority property.
Brijus Capital late last year sold a River North building on Erie for $35.3 million, or almost $300 per square foot, more than four times what it paid in 2013.
Blum said a replacement building on the Sports Authority site could max out at 250,000 square feet, preferably with a single tenant.
Morrie Mages a pitchman on WGN-TV’s “Mages Playhouse” in the early 1950s, sold his company in 1987, a year before he died at 72. The Grand Rapids, Mich.-based buyer, MC Sporting Goods, leased the property in 1994 to Sportmart, which merged with Sports Authority in 2003.