Billion-dollar Willis Tower sale keeps Chicago real estate hot

Blackstone Group has reportedly spent at least $1.3 billion, possibly $1.5 billion, to buy the Willis Tower, originally known as Sears Tower, in Chicago, Illinois. A managing director from the group said in a statement that the investors see opportunities to expand the tower's retail operations because of its popularity as a tourist destination.

According to real estate experts, commercial real estate in Chicago has been rising in value. Preceding the sale of the Willis Tower, the July 2014 sale of the office building at 300 N. La Salle had set a record at $850 million. The Willis Tower had previously sold in 2004 when American Landmark Properties bought it for $840 million. Turning it around 11 years later and selling for over $1 billion represented a significant gain.

Blackstone Group expects to continue gaining value from its Willis Tower investment. Information reported by the Wall Street Journal showed that the tower is visited by 1.6 million people a year who are attracted to its Skydeck and glass-ledge viewing platforms. The tourists generate $25 million every year.

Commercial real estate transactions involving high-value properties are inherently complex. Buyers and sellers might both choose to work with attorneys to help them oversee the details of the sale and negotiate terms. Both parties have liabilities and obligations to observe before, during and after a real estate transaction. Attorneys familiar with the requirements and pitfalls of commercial real estate could help parties determine value and protect themselves from unnecessary risks.

Source: Chicago Sun Times, "Willis Tower sale boasts highest price in Chicago's hot office-property market," Sandra Guy, March 16, 2015

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