Irvine Co., the developer led by billionaire
The 1.3-million-square-foot tower on the Chicago River, completed in 2009, is "one of America's finest office towers," said Doug Holte, president of the office properties division of Newport Beach-based Irvine Co. "The location and the product and the tenant roster make it an opportunity we couldn't pass up to expand our Chicago portfolio."
The price represents an almost 30% increase from the $655 million that KBS paid for the tower four years ago, when the commercial property market was near its bottom after the recession. Prices for centrally located offices in major markets such as Chicago, New York and San Francisco have since rebounded and were 16% above the 2007 peak as of March, according to
The price breaks the record for Chicago set by the $841-million sale of
Donald Bren, 82, is owner and chairman of Irvine Co., and his brother Peter Bren is KBS' president. KBS Realty Advisors, also based in Newport Beach, was founded in 1992 by Peter Bren and Charles J. Schreiber Jr. to invest on behalf of large institutional investors such as pension plans, endowments and foundations. In 2005, they formed KBS Capital Markets Group, which has raised more than $5 billion as of March.
The bidding process was open and competitive, and Irvine Co. would have tried to buy the building even if Peter Bren's company wasn't the property's owner, Holte said.