Blackstone and 233 South Wacker LLC announced that they had signed a definitive agreement for Blackstone Real Estate Partners VII to acquire the second tallest building in the country, the Willis Tower in Chicago, for $1.3 billion. The sellers of the 110-story skyscraper, formerly known as Sears Tower, are a group including New York-based investors Joseph Chetrit and Joseph Moinian, and American Landmark Properties Ltd. They paid $841 million for the tower in 2004, while Blackstone's purchase price of $1.3 billion is, according to Crain's Chicago Business, set to become the highest ever paid for a U.S. office building outside Manhattan. Douglas Harmon of Eastdil Secured LLC was the broker for the sale to Blackstone. Further terms of the transaction were not disclosed.
"We are bullish on Chicago as companies expand within and move into the city and look for first-class office space," Blackstone managing director Jacob Werner said in a statement. "We see great potential in further improving both the building's retail operations and the tourist experience for one of the most popular destinations for visitors to Chicago."
The Willis Tower is a 3.8 million square-foot office building in downtown Chicago and, at 110 stories, is the second-tallest office building in the United States and the fifth-tallest office building in the world. The building also features a top Chicago tourist attraction in the Skydeck on the 103rd floor, which provides 1.6 million visitors per year with unmatched views of Chicago and the surrounding area including from the "Ledge", glass cubes which extend from the building. The New York-based company plans to spend as much as $150 million to improve the tower's retail portion and 103rd-floor observatory, according to a Boston Globe article.
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