“After picking up a distressed office building near Willis Tower off the discount rack, Chicago investor Igor Gabal has purchased a vintage LaSalle Street property out of foreclosure with a $50 million-plus plan to transform it into as many as 190 apartments. And he’s already lining up his next big investment a few blocks away.
“In a transaction showcasing the lost value of office properties along the historic but vacancy-plagued LaSalle Street corridor, a venture led by Gabal and Chicago-based Envoi Partners this week paid just less than $4.2 million for a distressed loan tied to the 16-story office building at 19 S. LaSalle St., according to Gabal. As part of the deal, the venture simultaneously took control of the property through a deed in lieu of foreclosure, he said.
“Separately, Gabal confirmed he is under contract to pay $5 million for the distressed $39 million loan secured by the land beneath the Burnham Center office building at 111 W. Washington St. Completing that purchase could give him a path to seize the 22-story office building itself.
“The deals raise Gabal’s bet on the Loop as it recovers from the COVID-19 pandemic and navigates new work patterns that have hampered its vitality. A separate Gabal-led venture paid $4 million in January for the leasehold interest in a loft office building at 300 W. Adams St. — 89% less than that property was worth just more than a decade earlier.
“On LaSalle Street, Gabal said he sees a similar opportunity to benefit from a post-COVID Loop recovery with Google transforming the James R. Thompson Center and the city helping developers turn historic but outmoded office buildings into housing.
“‘I love Chicago and the old real estate, especially in the Loop. People want to see this come back,’ said Gabal, a former local apartment landlord who serves as president and CEO of premium chocolate, beverage and snack product importer Veroni Brands. ‘Resetting the basis (of Loop buildings) gives us the ability to reinvest a good amount of money in the buildings we’re looking to buy, and it’s positioned us for a long-term growth opportunity.’
“Gabal said the 131-year-old William LeBaron Jenney-designed building at 19 S. LaSalle is ideal for a residential conversion that will help house new employees in the Loop when Google makes the redeveloped Thompson Center its new Chicago home. The building at 19 S. LaSalle could include between 170 and 190 apartments, he estimated.
“‘We have a lot of homework to do and work (to do) with the city and all the parties involved,’ he said. (Ecker, Crain’s Chicago Business, 10/3/24)
”19 South LaSalle Street has been described as one of Jenney’s most ‘uncompromising’ facades due to its rectangularity which is only interrupted by horizontal banding at the 11th and 12th stories. Although, the horizontal courses and the building’s shifting design are typical of Jenney’s work around this time period. 19 South LaSalle is designed in an “L” shape with its more narrow 54 foot facade facing toward LaSalle Street while a longer, more elaborate 187 foot facade faces a small alley known as Arcade Place. The building stands 16 stories and was originally topped with a peaked roof which was replaced by an additional three stories. 19 South LaSalle Street was mentioned in the 2004 American Institute of Architects Guide to Chicago.” (19 South LaSalle Street Wikipedia)
Preservation Chicago is very supportive of the adaptive reuse of 19 South LaSalle Street. This is a very important early skyscraper designed by William LeBaron Jenney, the father of the modern skyscraper. Having three William LeBaron Jenney designed skyscrapers in a row makes this stretch of LaSalle Street extraordinarily significant in the world of architecture. This building is highly significant and deserving of a Chicago Landmark Designation to recognize, protect and support the building. We highly encourage the developer and other decision makers to pursue a Chicago Landmark Designation.
Read the full story at Crain’s Chicago Business
- Investor plans LaSalle Street office-to-apartment conversion, eyes distressed Loop offices, Danny Ecker, Crain’s Chicago Business, 10/3/24
- Foreclosure suit hits LaSalle Street landlord; The 129-year-old building at 19 S. LaSalle St. could be a candidate for conversion to a residential or other use as the city tries to bring more foot traffic to the heart of the Loop; Danny Ecker, Crain’s Chicago Business, 11/2/22
- 19 South LaSalle Street Wikipedia
- 19 South LaSalle Website