Former Cinespace Owner Buys Distressed Chicago Office Building

The entrepreneur whose family built a film and TV empire in Chicago is making another commercial real estate move.

Former Cinespace owner Alex Pissios added a distressed office building in River North to his firm’s growing Midwest portfolio.

Alecko Capital purchased the 89,500-square-foot office building at 620 North LaSalle Drive for $7.4 million, Crain’s reported. The deal worked out to about $82 per square foot.

The was a short sale after previous owner Next Realty transferred the eight-story property to Wintrust Bank through a deed in lieu of foreclosure. That allowed Wintrust to avoid a prolonged foreclosure process while selling the asset at a fraction of its previous value.

Pissios’ career in real estate development had a rocky start. He and his wife filed for bankruptcy after the Great Recession crushed demand for the residential condos his firm built near the United Center.

His plans for the building are unknown, but the film industry is drying up in Los Angeles, even though all of the major studios are still based there. Many successful productions, especially in film, flee the city, seeking tax breaks and lower costs. However, East End Studios, a subsidiary of New York-based East End Capital, has a $1 billion plan to build a film studio in downtown Los Angeles.

Alecko Capital also acquired a Fulton Market property, at 232 North Carpenter Street, for $11 million in 2022. That was Pissios’ first major commercial real estate investment after selling his ownership stake in Cinespace Studios Chicago campus on the Near West Side for $1.1 billion to San Francisco-based private equity firm TPG. The studio was the soundstage for “Empire,” “Chicago Fire” and “The Chi.”

The LaSalle Street property was built in 1922 and has undergone several transformations over the years. It was long associated with sporting goods retail, serving as a flagship location for Morrie Mages’ chain before later housing Sportmart and Sports Authority.

Next Realty repurposed the property into a co-working space in 2018 in partnership with IWG’s Spaces brand. However, the venture struggled when Spaces shuttered its location early in the pandemic, leaving it largely vacant.

Next Realty had refinanced the property with a $21.3 million loan from Wintrust that same year, but after Spaces closure, it became more challenging for the company to secure long-term tenants.

The loan was modified in 2023, reducing the outstanding debt to $14.3 million, but the firm was unable to recover its investment.

— Andrew Terrell