On July 27, the DePaul Real Estate Alumni Alliance (DREAA) attracted more than 150 alumni and friends to its Fifth Annual Office Market Boat Cruise. With Chicago's skyline serving as the backdrop, the centerpiece of the event was a dockside discussion of Chicago's downtown office market. The panel discussion, moderated by DREAA co-president Rob Damrat, Barings, included Max Meyers, R2 Companies; Brad Serot, CBRE; Matt Pistorio, The Telos Group; and Tony Scacco, Riverside Development.
|Matt Pistorio, The Telos Group; Max Meyers, R2 Companies; Brad Serot, CBRE; Tony Scacco, Riverside Development
The speakers were asked to provide an overview of their projects, and a view of the marketplace.
Matt Pistorio, The Telos Group
Pistorio described Telos Group first and foremost as a marketing company. He then added, "We take on big ugly buildings and take them back to market."
While the company has made a name for itself through success in that niche, Pistorio did say that the company is now in a position where it is taking on core projects for institutional owners.
He pointed to Prudential Plaza as being one of the company's greatest success stories, bringing the building from almost 20 percent to 100 percent leased. Pistorio pointed to the Old Post Office as another one of those big ugly buildings the firm has taken on.
"It's real," he said, noting the 20 or more false starts that have plagued the project for decades. "More than $100 million in contracts for the project have been approved.
Max Meyers, R2 Companies
Meyers represented an altogether different segment of the marketplace, but one that has been very important in the success and transformation of downtown: the owners of creative office spaces.
R2 Companies started in River North when there was a lack of owners of creative office spaces. With ongoing redevelopment taking place in River North, the West Loop and Fulton Market, that landscape has changed considerably.
"What's happening today," he said, "is fascinating. There aren't a lot of secrets today; only a lot of churn."
Meyers highlighted how the firm continues to look for opportunities, including in secondary markets like Milwaukee, while digesting the projects it has already taken on. He cited the WGN studio property as a great example of the potential to be transformational to an area, while also generating cash flow now, while the future of the area is still being determined.
"We are very careful with what we do so that we can carry the properties and survive," Meyers said.
Brad Serot, CBRE
Adding the tenant perspective was Serot, a 16-year tenant rep veteran who has been representing tech, venture capital and healthcare firms in some of the most significant transactions in the city.
"I am really bullish on Chicago and the environment for tech companies it has created," Serot said. "I think I have some of the coolest clients in the City."
Tony Scacco, Riverside Development
According to Scacco, with tongue in cheek, if John O'Donnell's golf game had been better after he first retired, the momentum that has carried over from 150 N. Riverside to 110 N. Wacker Drive may never have been created.
Scacco is one of several people O'Donnell, over time, was able to recruit from The John Buck Company to focus solely on development projects like the recently completed, 1.2 million square foot 150 N. Riverside building. He said there are a lot of synergies between what's taking place at 110 N. Wacker and what already has been accomplished at 150 N. Riverside.
"You need lots of strategic partnerships and a singular focus" to make things happen on the Chicago development scene, according to Scacco. That's why, for 110 N. Wacker Drive, the company has partnered with the Howard Hughes Corporation and Bank of America. "Once those partnerships were forged, and Howard Hughes Corporation acquired the existing ground lease, everything steamrolled from there," he added.
And if those two projects weren't enough, Riverside Development can always divert attention to another mammoth project, Union Station.
DREAA designates a portion of proceeds from their events to award academic scholarships to students studying real estate at DePaul. Last year they provided $7,000 in scholarship support. Earlier this year, in May, an event that honored CBRE's Jack Durburg raised more than $220,000.