Phoenix Development Partners Acquires Historic Chicago Office Building to Redevelop as 350-Key Dual-Branded Hilton Property
Phoenix Development Partners ("Phoenix"), as the lead sponsor, in partnership with Green Door Capital, Crowdstreet, Polaris, among other minority investors, announced the acquisition of 226 West Jackson (Chicago), a 238,000sf historic office building. This property will be restored and transformed to become a 350-room dual flag Hilton property (a Canopy by Hilton - 215 rooms - on the upper floors and a Hilton Garden Inn - 135 rooms - on the lower floors).
John Mangel, Founder and CEO of Phoenix Development Partners commented that "the restored property will include a new 4,800sf rooftop restaurant, bar and meeting space plus 2,100sf of outdoor terraces offering sweeping views of the city."
Centrally located in Chicago's dominant West Loop neighborhood, this building is directly across the street from Willis Tower and a short walk to the Old Chicago Post Office, as well as BMO's and Bank of America's new headquarters buildings. "Another critical piece of the ever evolving, and dominant, West Loop Landscape" Said Peter Ulrich, Director of Capital Market Services for Phoenix.
It should be noted that Willis Tower has invested over $500mm with a plan to improve lifestyle for Tenants in the building and, specifically, to be an attraction for tourism in the city. The 300,000sf addition on the south side of the Tower will offer restaurants and entertainment venues for public consumption and private events. The private event space will offer banquet/ballroom and meeting space that will offer a unique benefit this new dual flagged property by providing a solution for guests looking for lodging within footsteps of these facilities.
This property will serve a long list of corporate neighbors that include United Airlines, BMO, Bank of America, Walgreens, Uber, Facebook, Google, McDonalds, MillerCoors and Boeing among many others. "We are excited to acquire this exceptional asset and add to add this property to our expanding portfolio. We are also excited to present the very first Canopy by Hilton to the Chicago marketplace." said John Mangel.
"Given the strong performance of the West Loop Hospitality market, coupled with the opportunity to introduce these Hilton options at this central point in the CBD, we believe this is a significant opportunity and we will work with Hilton and Aimbridge Hospitality to bring a truly unique experience to Chicago" said Michael Schweitzer, Phoenix Vice President of Operations.
226 W. Jackson Boulevard is the former corporate headquarters of the Chicago & Northwestern Railroad Building and, more recently, the City Colleges of Chicago. The property will be redeveloped into a unique hotel offering that combines modern amenities with an homage to its historic past. The Hotel will be a dual branded hotel, allowing it to capture demand from a variety of business and leisure travelers in Chicago's Central Business District.
Construction at this historic property will begin in early October with Leopardo Construction and will be complete in the Spring of 2021. Owners representation for Phoenix will be Daccord, Architectural services provided by Hartshorne Plunkard Architecture, and interior design services provided by Anderson Miller and Hospitality Furnishing & Design.
Senior Loan financing was provided by the Merchant Banking Division of Goldman Sachs and arranged by Draper and Kramer Incorporated and Historic Tax Credit investment secured with Twain Financial Partners.
The hotel will be managed by Aimbridge Hospitality. This is the third property Aimbridge manages for Phoenix.