State of Illinois Agrees to Sell, Then Buy Back Space at Thompson Center, Which New Owners Say They Will Renovate | State and Region
CHICAGO — The State of Illinois on Thursday finalized a deal to sell the James R. Thompson Center for $70 million and then buy back about a third of the building for more than double that amount.
The sale to a company headed by Michael Reschke, chairman and chief executive of property developer The Prime Group, will spare the controversial Helmut Jahn-designed Loop headquarters from the wrecking ball.
The state began negotiations with Rechke’s JRTC Holdings in December, and the deal was signed just before Tuesday’s deadline set by state law.
The initial $70 million payment to the state is dwarfed by the roughly $146 million the state will pay to buy back office space once the notoriously dilapidated building is renovated, a net cost of $76 million.
In the long term, however, state officials say the deal is good for taxpayers, who would otherwise bear the full cost of necessary upgrades to the 17-story glass and steel structure — estimated at $325 million. dollars – or buying or renting other office space in the central business district.
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Governor JB Pritzker’s office estimated the deal will save the state $20 million a year for the next 30 years by consolidating office leases and reducing operating expenses.
The sale, which is expected to close this summer, will also add “vitality to Chicago’s LaSalle Street hallway by honoring the original design through a modern lens,” Pritzker said in a statement.
JRTC Holdings is working with the late Jahn’s company on its plan to revamp a building, named after former Governor James R. “Big Jim” Thompson, that has inspired strong opinions since it opened in 1985.
The redevelopment plan calls for the installation of a glass curtain wall to separate the office floors from the soaring atrium, which should alleviate many of the heating and cooling and noise issues facing the building faced, Reschke said late last year when announcing the tentative agreement.
“This atrium will become the monumental entrance to the future office building, and it will be unlike any other entrance in the city, and indeed in the country,” he said.
The overhaul is expected to take about two years, and Reschke estimated it would cost around $280 million.
CTA’s Clark/Lake station, which occupies part of the building, will remain in operation for the duration of construction.
When completed, the state will occupy 425,000 of the building’s 1.2 million square feet.
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