A New York investment firm sold a Chicago mall at a roughly 44% discount in December after scrapping a major development plan for the troubled property.
RPT Realty has sold Webster Place, a 135,000 square foot shopping center located at Webster and Clybourn Avenues to local contractor Novak Construction for $29.3 million, Crain’s reported. The investment firm bought the property for $52.7 million in February 2017.
The RPT drew up plans to expand the property with two residential buildings in 2018, but abandoned the proposal and listed the mall in July 2021. While the center is in a densely populated, high-income neighborhood, the rate of d Occupancy was 68.6% last fall after its largest tenant, Webster Place Athletic Club, closed in 2019.
Consumers have turned to online venues over physical stores amid a shift in shopping habits, and the pandemic has accelerated the mall downturn in 2020. It hasn’t helped that Webster Place’s major tenants included Regal Cinemas and Barnes & Noble Bookstore, areas hit hard by the pandemic.
Novak Construction’s development plans for the property are unknown. The contractor planned to build two 20-story apartment buildings south of the mall in 2018, but never followed through. Medical offices and retail space, less vulnerable to e-commerce competition, could be a potential use for the space, according to JLL, which has been hired by RPT Realty to sell Webster Place.
The local entrepreneur has purchased several retail spaces over the past two years. Novak purchased two former Sears stores in Portage Park and Galewood in 2020 and plans apartments and retail space for both locations. A Novak firm also paid $25 million for a 43,000 square foot storefront in the Loop a year ago.
RPT last year sold a 167,000 square foot shopping center in suburban Glen Ellyn to local investor North American Real Estate Group for $30 million. California-based investment firm LBX Investments’ $67 million purchase of Evergreen Plaza Mall at 9500 to 9700 South Western Avenue was the city’s largest commercial real estate deal of 2021.
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