In our last newsletter, we shared the storyline “When Bad Things Happen to Good Properties”. The story’s premise was that regardless of the level of due diligence completed, over time unexpected or unplanned property-related events can occur, even at good properties. In today’s retail environment, unplanned events include store closings and tenant bankruptcies.
In this issue, we’re adding to that storyline with another “Good” Next Realty property, the iconic 620 N. LaSalle Street building.
In the original story, Next Realty CEO, Andy Hochberg, identified some of the key elements in an owner’s capacity to overcome those “bad things” as the capacity to:
- Acquire properties in desirable locations,
- Have liquidity from property or portfolio operations to explore and execute other options, and,
- Experience a little luck in delivering solutions when unexpected events change the landscape of the property.
Over time, in addition to being hard-working and focused, Next Realty has benefitted from owning properties, like 620 N. LaSalle, that exemplify the company motto of Location, Liquidity, Luck® to overcome challenging situations.
An affiliate of Next Realty has owned the iconic building since 2002. At acquisition, the property was fully leased to Sportmart, predecessor to The Sports Authority which took over the full space, keeping the building a sporting goods store. Yet in 2016, The Sports Authority ceased operations leaving a large hole to fill.
With its iconic history and prominent location in Chicago’s River North market, punctuated by millennial driven office space users, new residential development, and a vibrant entertainment scene, Next Realty began marketing the property as a redevelopment opportunity, a corporate build-to-suit and/or a new ground-up development.
The timing was fortuitous. The coworking trend was rapidly emerging and helping to shape the downtown office market. Ultimately, in early 2018, Spaces, a coworking firm, leased the entire building for their flagship Chicago location. Spaces began operations in the building in September 2019 after a comprehensive gut renovation and repositioning of the property.
Today, 620 N. LaSalle continues the success of turning a bad situation into a winning outcome, for the owner, tenant and community. The common themes behind these Next Realty success stories include Location, Liquidity, Luck® … and lots of hard work!