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Jenner & Block sued by Heitman over office rent amid coronavirus - Crain's Chicago Business

The owner of a River North skyscraper is taking Jenner & Block to court, alleging the Chicago law firm failed to pay its rent for the past two months.

In one of the first major legal spats over unpaid rent at a downtown office tower amid the coronavirus crisis, a venture of real estate investment firm Heitman is seeking nearly $3.9 million in damages from Jenner for allegedly defaulting on its lease at 353 N. Clark St., according to a lawsuit filed in Cook County Circuit Court. (Read the complaint below.)

Jenner, which leases about 416,000 square feet, or roughly a third, of the 46-story building, missed rent payments due April 1 and May 1 and owes other unpaid fees tied to its lease, according to the complaint.

The suit spotlights the ongoing tension between office landlords and tenants from a pandemic-induced statewide stay-home order that closed many buildings and shut down most economic activity over the past two months. Many companies enduring a crisis that has bludgeoned their revenue have sought relief from landlords on rent, yet some landlords rely on rental income to be able to make their debt service payments.

Attorney John Riccione of law firm Taft Stettinius & Hollister, which is representing Heitman, declined to comment on specifics of the lawsuit but said in a statement that Heitman "is committed to a proactive engagement with their partners and tenants to address any challenges constructively that have arisen from the COVID-19 crisis."

Jenner, which has been in the building since it opened in 2009, said in a statement that the dispute boils down to wording in its lease about what it owes for rent at a time when part of its office is unusable because of the shutdown.

"Our Chicago office lease includes a negotiated provision for rent abatement in the event of a situation, like the global pandemic, that renders the firm unable to use and occupy the space for its intended purpose. The firm has invoked that provision," the statement said. "We have credited the landlord for the limited space we have been able to use for its intended purpose. Jenner & Block has a very strong financial position; this dispute is exclusively about the enforcement of that provision in the lease."

Heitman has owned the 1.2 million-square-foot building since 2014, when it bought it for $715 million, the second-most expensive sale per square foot at the time for a downtown Chicago office building. The building is 94 percent leased, according to real estate information company CoStar Group.

The Chicago Tribune first reported the lawsuit.

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Jenner & Block sued by Heitman over office rent amid coronavirus - Crain's Chicago Business
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