(Crain’s) — A New York developer has a tentative deal to buy a sought-after property near McCormick Place, where Skokie-based Alter Group Ltd. had hoped to build a mixed-use project with as many as 1,500 hotel rooms.
Extell Development Co. has the 3.7-acre American Book Co. site under contract and is about halfway through an 80-day due diligence period to buy the property at 320 E. Cermak Road and 2132 S. Calumet Ave., according to sources familiar with the matter.
Extell has agreed to pay about as much as the $70 million that Alter had offered before its deal fell through, sources say. One complication that hung up Alter’s deal was the city’s move, which is still pending, to assign landmark status to the former book warehouse.
Related story: Alter loses control of site near McCormick Place
It’s unclear what Extell’s exact plans are for the property. But it’s likely they would include a large hotel to serve convention center business, and that the five-story, brick-and-limestone American Book Co. building will have to be at least partially preserved.
Extell executives didn’t return calls. The company is headed by prominent developer Gary Barnett and has more than 10 million square feet of real estate in its portfolio, including several residential, office, hotel and mixed-use projects in New York.
In Chicago, the firm owns the 12-story Daniel Burnham-designed office building at 175 W. Jackson Blvd., also known as the Insurance Exchange Building, which is just west of the Board of Trade Building. Extell bought the 1.45-million-square-foot property in 1998 for $55 million, according to real estate research firm CoStar Group Inc.
The American Book Co. site is owned by the husband-and-wife investment team Karl Norberg and Pam Gleichman of Maine. A call to Ms. Gleichman’s office wasn’t returned.
Brad Boersma, a vice-president with the Chicago office of DTZ Rockwood who is marketing the property, confirms that the site is under contract but wouldn’t identify the prospective buyer and declines to comment. Representatives of Alter Group couldn’t be reached.
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