Hearn to Convert Part of Chicago Tower to MOB

875 N. Michigan Ave. Rendering courtesy of Cushman & Wakefield

The Hearn Co. plans to convert four levels of office space at 875 N. Michigan Ave., a more than 1 million-square-foot office tower in Chicago’s CBD, to medical office use. The redeveloped space, dubbed Mag Mile Medical Pavilion, will house surgical and clinical rooms.

The owner plans to invest $10 million into the conversion project that will breathe new life into floors 28-30 and 33 totaling approximately 130,000 square feet. Slated for completion by the second quarter of this year, Mag Mile Medical Pavilion will include an exclusive entrance with patient drop-off and pick-up, an assigned elevator bank, floorplates reaching roughly 33,000 square feet and more than 12-foot ceiling heights.

The Hearn Co. has appointed Cushman & Wakefield to market the medical office portion within the 100-story office tower, formerly known as John Hancock Center. Cushman & Wakefield’s Healthcare Advisory Practice leasing team includes Directors Karoline Eigel and Lindsey Groom, Managing Director Matt Sullivan and Senior Associate Jack Seher.

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875 N. Michigan Ave. Rendering courtesy of Cushman & Wakefield

While nearly half the number of floors encompass residential space, the tower also includes 172,000-square-foot of retail space across six floors and 10 levels of parking space. The multi-tenant tower was originally built in 1970 and underwent several renovations, most recently in 2017, according to CommercialEdge data.

The tenant roster for the office component includes several consulates, Novogroder Cos., Regus and Adler Weiner Research, among many others.

A strong downtown Chicago submarket

The North Michigan Avenue submarket―home to 875 N. Michigan Ave.―closed 2021 with the lowest office vacancy among the other downtown Chicago submarkets clocking in at 15.4 percent, while the average for the CBD was 20.3 percent, according to Cushman & Wakefield. Over the same period, medical office vacancy was even more promising in the submarket, clocking in at 5 percent.

Mag Mile Medical Pavilion will be just a few blocks away from the Northwestern and Streeterville Healthcare Campuses, encompassing more than 13 million square feet. Tenants include Prentice Women’s Hospital, Northwestern Memorial Hospital and Ann & Robert H. Lurie Children’s Hospital of Chicago, besides other health-care tenants.