Irvine Co. nears deal to buy Hyatt Center

By Dow Jones Newswires
Posted Dec. 15, 2010 at 6:18 a.m.

The Irvine Co. is close to an agreement to buy the 49-story Hyatt Center in Chicago for about $625 million from the Pritzkers, the storied family whose business empire includes a majority stake in the Hyatt Hotels Corp. chain, according to people familiar with the deal.

The sale of the curved tower at 71 S. Wacker Drive in Chicago, which contains about 1.5 million square feet of office space, could close as early as Friday, people said. The deal could still collapse, but if completed, the building would be one of the largest Windy City properties to trade this year.

At a price that equates to just more than $400 a square foot, however, the price per square foot is less than the record fetched by a Chicago office tower at 300 N. LaSalle, which sold for about $500 a square foot earlier this year.

A spokeswoman for the Pritzker Realty Group declined to comment on the matter, as did a spokeswoman for Irvine. The Pritzkers, who control a business empire founded by Nicholas J. Pritzker more than a century ago, have sold billions of dollars in assets in recent years after a family dispute arose over their management.

Irvine Co., a privately held Newport Beach, Calif., real-estate company, is controlled by its chairman, Donald Bren. The Chicago acquisition would be a departure for the Golden State company, which has historically focused on real estate in Orange County, Calif.

If the deal is completed, Irvine will be picking up one of Chicago’s more distinctive and newer skyscrapers. The curved-glass and stainless-steel tower was designed by Henry N. Cobb, who also designed the John Hancock Tower in Boston. The building, which opened in 2004, is in a tony area near the Willis Tower and is about 96% leased.

Its tenants include Hyatt’s headquarters as well as Goldman Sachs Group Inc. There is about $325 million in securitized debt that is backed by the property.

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