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This Used to be a Warehouse?
October 3, 2013

This Used to be
a Warehouse?

When industrial product gets old, don't shed a tear. Redevelopment possibilities are endless, and the trend's catching on in Bedford Park. (Who hasn't stood in a refrigerated storage unit on a hot summer's day and said "You know, I could live here.")

A venture including Sitex Group just sold 30 acres, the site of a former 1.2M SF multi-story industrial complex, to the City of Bedford Park and Reavis High School, NAI Hiffman EVP Larry Much tells us. He brokered the deal, located just south of Midway Airport at 5401 W 65th St, with NAI Hiffman EVP Mark Moran. Snapped at the Hawks home opener with his daughter Devyn, Larry says this demolition and land sale is indicative of a larger trend of outdated industrial product being torn down for redevelopment or alternate uses. In this case, the city envisions a possible combination of retail and industrial, viewing control of the site's future as a means to boost commercial business around town.
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5401 W 65th Bedford Park
The Sitex venture decided to demo the six-story behemoth (purchased from Richman Asset Management) three years ago, as its efficiency for an industrial user had clearly diminished. The raw land fell victim to the downturn for a time, but it's become a good opportunity to re-gentrify as well-located large swathes of land prove harder to come by, Larry says. Another industrial makeover: Edward Don's former HQ at 2500 N Harlem Ave in North Riverside, he notes. Given the 350k SF industrial building's poor condition, the owner sold a portion of the land to Costco (the new store is slated to open in November), leaving out lots for additional retail on site.

Retail Buzz From ICSC

Miss Illinois, meet Mr. Retail. ICSC's in town, and we got the on-the-ground buzz from JLL VP and retail tenant rep Jason Trombley, who sent this celeb snapshot. "We haven't been this busy in half a decade," he told us while dodging traffic on the convention floor. "Some people are even double-booked." Retailers are going into the market looking for depressed pricing, but the best opportunities are being gobbled up quickly, Jason says. And the competition shows no signs of slowing, especially since lack of new construction wore down supply in the past few years. (Someone should build a store that sells stores. That'd help with supply.)

Another positive trend: Everyone fled to the density of urban markets when the downturn occurred, but now suburban development is popping up in select infill growth markets and restoring a sense of normalcy, Jason says. And big-box lights are coming on again as active users like Art Van Furniture (above), Sears Outlet, and Floor & Décor move in. On Jason's deal sheet, he closed a Vernon Hills site for AAA Automotive (completion scheduled for Q2 2014) and moved a 45k SF Sears Outlet into a former Circuit City across the street from Fox River Mall in Appleton, Wis.

Change Without Moving

Friends of Sinai_Golf_Reception_2339
Forget loft offices and co-working spaces. Established workplaces are learning how to move forward while standing still, upgrading to improve space efficiency while bringing the sought-after buzzword—collaboration—into the mix. Repped by Studley EVPs John Goodman (center, at Studley's recent charity golf event) and Rick Schuham, Heitman Financial just renewed its 58k SF lease at 191 N Wacker for 10 more years. (Manulife Financial's Bruce Pearson and Dan Shapiro repped the landlord.) Instead of an expected expansion or relocation, the company chose to reduce private offices and boost open workstations, getting more bang for their buck with their current square feet. (Plus you don't have to hit up your friends to help you move.)

Screen Shot 2013-10-02 at 11.56.57 PM
John and Rick tell us two ends of the market are benefiting from this tech company-driven workplace paradigm shift: Class-A new product and large floor-plate warehouses that are conducive to conversions. In an effort to attract the coveted Millennial workforce, buildings with a neighborhood feel inside and around the property are fairing best, they say. (Think rooftop decks, bike rooms, and a vibrant restaurant/bar scene nearby.) Outside the office, John and his wife are enjoying life as new empty nesters, finding more time for yoga, golf, and last minute weekend travel.

Cedar Street Cos Turns 10

The micro living mavens at Cedar Street Cos celebrated 10 years in business by creating a pop-up gallery in the former Vaudeville Theatre in Uptown, which they acquired earlier this year. Snapped: artist Cheryl Pope, with Cedar Street partners Jay Michael and Alex Samoylovich (and an artistic photobomb on the right). With the help of The Department of Cultural Affairs and Special Events, the company has turned the space into an art gallery for Chicago Artists Month. Cedar Street's FLATS CHICAGO brand of micro apartments continues to grow as the firm accumulates and continues renovations on distressed assets on the North Side (Uptown, Edgewater, Andersonville). Read more on the tiny trend here.

Happy National Mean Girls Day! In honor, tell marissa.oberlander@bisnow.com the most embarrassing thing you did in high school. Ours was probably playing the flute.

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