Conlon buys River North building for new HQ

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Conlon buys River North building for new HQ

By: Ryan Ori
Crain's Chicago Business

A venture of Chicago-based Conlon & Co. paid about $6.55 million for a River North loft office building, where the real estate firm will move its headquarters from the West Loop.

The venture bought the four-story, 52,000-square-foot building at 401 W. Ontario St. on July 30 from Schaumburg-based bar and restaurant group Ala Carte Entertainment, the buyer and seller confirmed.

Conlon, which has been on a buying spree in River North, will move its headquarters to about 10,000 square feet in the building from its current offices at 1101 W. Lake St., said Chairman Sean Conlon.

About 25 headquarters employees and 75 agents from Conlon's commercial and residential brokerages plan to move in the first quarter of 2016, the firm said. The firm plans a multimillion-dollar renovation of the 103-year-old structure, Conlon said. The building is currently fully leased.

“It needs a lot of attention, but the bones are fantastic,” Conlon said. “It's a great building, and it's a fill-in (location) between the West Loop and River North. It allows us to cover both areas, and it's a great buy.”

DEAL PARTNER

Conlon's investment partner in the deal is hedge fund manager Joe Scoby, CEO of Chicago-based Achievement Asset Management and formerly with O'Connor & Associates and UBS. Scoby also invested in two other recent Conlon acquisitions in River North: a nearly $14 million deal for the Rainforest Café building at 606 N. Clark St. and a $6 million deal for the former SushiSamba Rio space at 504 N. Wells St.

Conlon was represented in the deal by Conlon Commercial broker David Goldberg, who's also a partner in the deal.

Tenants in the building include film production company Radar Studios—which produced commercials for McDonald's and WeatherTech for this year's Super Bowl—and film equipment seller Zacuto, each of which lease about 8,000 square feet, according to Conlon.

Ala Carte owner Mark Hoffman said he and his father, Fred, have owned the building for about two decades, after buying it for $650,000 in the 1990s to provide storage for their bars and restaurants and other businesses. Mark Hoffman even lived in the building for a short while after buying it, before it was eventually converted to offices, he said.

'THEY'RE GOING TO DO WONDERFUL THINGS'

The Hoffmans decided to sell the building amid rising property values in River North and Ala Carte's shift in focus toward suburban locations.

“It's been a very profitable building for my family for many years, but my company's growth pattern has changed,” Hoffman said. “They're going to do wonderful things with that building—things that, if I'd had the time, I would have done.”

Ala Carte is in the process of adding five new suburban bars and restaurants, two each in Rosemont and Hoffman Estates and one in Morton Grove, bringing its total to more than 30 establishments, Hoffman said. Just two of those are in the city: Lion Head Pub in Lincoln Park and Moretti's Ristorante & Pizzeria in Edison Park.

In 2014, Ala Carte sold the Snuggery Pub & Eatery building in the Gold Coast to Conlon and sold the Castle nightclub building in River North to Chicago-based Four Corners Tavern Group.