Howard Hughes Corp. Debuts $723M Trophy Tower

Chicago’s skyline gets a new addition with the completion of 110 North Wacker, a 1.5 million-square-foot trophy office tower standing 55 stories in the center of downtown. The Howard Hughes Corp. and Riverside Investment & Development have just announced the opening of what is now the tallest new office building to rise in Chicago in the last three decades. The project carries a development price tag of approximately $722.6 million, according to SEC documents.

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110 North Wacker sits along the Chicago River on a historic West Loop site that had been home to a six-story building before general contractor Clark Construction demolished the mid-century structure in advance of the office project’s groundbreaking in 2018. Designed by architecture firm Goettsch Partners, 110 North Wacker attracted a great deal of attention among office users well before it began to sprout up on its trapezoid-shaped parcel on Wacker Drive. In 2017, Bank of America signed on as the building anchor, preleasing approximately 500,000 square feet of state-of-the-art office space. With exclusive leasing broker CBRE at the helm, other commitments from the likes of real estate investment advisor Heitman, global investment bank Lincoln International and leading law firm Jones Day soon followed.

Today, 110 North Wacker is roughly 80 percent leased and the buzz about the highly amenitized property endures. “[The owners] remain confident about future leasing momentum continuing,” a source familiar with the property told Commercial Property Executive. HHC and Riverside have incorporated several enhancements at the LEED-certified building to accommodate the office-dwelling community’s new pandemic-era demands, including an advanced secondary air filtration system and touchless access options.

Lease-up during the new (ab)normal

While 110 Wacker’s unique sawtooth design, premier amenities and prominent location between a multilevel thoroughfare continue to attract attention, the cutting-edge asset has not escaped the coronavirus-induced changes to the U.S. office sector. As noted in a third quarter 2020 report by Savills, pending the advent of an effective, widely available vaccine and the return of workers to the office en masse, market inactivity will likely persist. Savills anticipates that market fundamentals will further soften for the next few quarters before stabilization occurs in late 2021; although, a new wave of infections this winter would prolong the downturn.

HHC and Riverside Investment are not allowing current conditions to dampen their expectations for 110 North Wacker. “The pandemic certainly has an impact on the market, but there’s still going to be a need for offices, and having a building with the best location, the best amenities and the highest commitment to safety and wellness will position [110 North Wacker] as one of, if not the best option in Chicago,” the source said.