The National Association of Realtors (NAR) announced earlier this week its purchase of 437 N Rush, a two-story building that borders the west side of the association’s Chicago headquarters off Michigan Avenue.
NAR will now own the entire block on which its office sits, and for more details about the transaction, we spoke with Doug Hinderer, NAR’s senior vice president.
- 437 N Rush was previously owned by the Wrigley Company.
- The deal, which was for $1.45 million, was conducted with Phil Hoffer of GNP Realty representing NAR and Bruce Miller of Jones Lang Lasalle representing the Wrigley Company.
- GNP normally represents NAR in its real estate dealings, considering it has a long-standing relationship with the association and is the management company in charge of its headquarters.
- There were no commissions involved in the deal; both brokerages were independently compensated by the parties they represented.
- The purchase was an all-cash transaction.
- The building will not result in any direct financial benefit to members, at least in the form of reduced membership dues or refunds.
- The true benefit, Hinderer explained, is in how the new building “enhances the equity and value” of NAR’s headquarters, especially that it prohibits any speculative development of the lot that could negatively impact the value of NAR’s building.
- Also, Hinderer said the building made sense as an investment; it was better, after all, for NAR to invest in prime real estate during a downturn, rather than allow the money to sit in the bank and collect interest. “If we decide to sell in a year for a profit, people will say it was a great investment,” Hinderer said.
- NAR does have not have any near-term plans for the building. They could knock it down and expand their headquarters, or maintain the property as is and continue to collect revenue from the building’s tenets, which include the Phil Stefani’s 437 Rush Italian Steakhouse. The amount of revenue, Hinderer said, is confidential information.
- If NAR does ultimately decided on doing something with the building, it will have been the result of a multi-tier process. First, NAR’s Building Committee, a 12-member body composed of commercial Realtors that manages NAR’s three buildings, will draft a proposal for the land; then, NAR’s Finance Committee will analyze the proposal and see if it makes financial sense; then, finally, NAR’s Board of Directors will make a final decision on the plan.