MGA went under contract for this property in June 2013. 405 N. Wabash is located on the plaza between the Wrigley Building and Trump Tower and consists of 20,242 square feet of retail space. The property was fully occupied with a McDonald’s, Bongiono’s Pizzaria, LA Tan, City Grocery and Sports Ortho rehab clinic. The contract closed in September 2013.
The pizzeria lease was the only tenant anywhere near market rent. This was a re-tenanting opportunity. The McDonald’s lease expired in May 2014 but they had an option and exercised it. Sports Ortho did not renew in November 2014 and they were replaced with an Athletico rehab clinic by February 2015. It was during this period that we were working with our architect to create a different look for the building exterior and negotiating with McDonald’s for a lease buyout. The negotiation with McDonald’s was successful so we recapitalized the venture, to incorporate the redevelopment dollars and the lease buyout, with an additional $2 million.
Beacon Tavern signed a lease in April 2015 for the McDonald’s space at 5 times what McDonald’s was paying. We coordinated our exterior redevelopment with their build-out and completed it in May 2016.