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The Deal Sheet

Chicago Deal Sheet

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After spending much of the past decade working on 1.5M-plus SF in retail and mixed-use projects around New Jersey, Highland Park-based Tucker Development is turning its focus back home and aiming high with ambitious ground-up projects. (A decade in Jersey prepares you for anything.)

The Deal Sheet

Prez and CEO Rich Tucker, just back from hiking the Grand Tetons in Jackson Hole, tells us the firm has a handful of big Chicago-area projects in the pipeline: two suburban transit-oriented, mixed-use projects and three within city limits that have retail and significant residential components. The rest is hush-hush until contracts are signed, but nothing’s under $50M and a look at Tucker’s NJ projects can offer an idea of their scale, Rich says. In Fort Lee, NJ, the firm’s Hudson Lights development (below) will be a $500M project when its phases are complete, including 200k SF of retail, 477 luxury apartments, and a 175-room hotel.

The Deal Sheet

Tucker looks for sizable mixed-use development sites in densely populated areas with high barriers-to-entry, whether that’s near train lines in the city (with the option to go vertical) or in significant downtowns in the ‘burbs. The firm either self-finances projects through funds it’s created with institutional partners or will JV. (Both cases are generally 65% to 75% debt and 25% to 35% equity.) Rich calls larger ground-up projects a more efficient use of company resources from a manpower and capital perspective, plus larger mixed-use deals better insulate you from the competition. And it’s fierce these days, shrinking returns significantly on value-add retail plays. For now, Tucker will stay focused on building new out East and here at home (keep your eyes here for details in the coming weeks).

SALES

The Deal Sheet

Bridge Development Partners purchased a 55-acre business park formerly used by Dominick’s at 555 Northwest Ave in Northlake. Bridge will market the park as Bridge Point Northlake and plans to retain two two existing buildings in the park: a 162k SF cooler facility and 135k SF freezer facility (that will be expanded by 104k SF). Bridge will raze obsolete buildings to make way for a new 588k SF distribution center (above), to be delivered in Q3 2015. CBRE’s John Suerth and Jason Lev repped Safeway in the sale and have been retained to market all three properties for Bridge.

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Cushman & Wakefield Midwest multifamily advisory group senior director Bill Montana and director Chris Sackley completed the $16.3M sale of 222-unit Timberlake Apartments, 1450 Busse Rd in Mount Prospect, repping a private partnership. The buyer is an out-of-state investor. The value-add property was 97% occupied at the time of sale.

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Windy City RE paid $7.6M for the mid-rise Studebaker Building, 2012-2036 S Michigan. The firm plans on converting the completely gutted seven-story building into 75 rental units and 37k SF of commercial space.

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Millennium Properties R/E sold 71 properties in Illinois, Indiana, and Arizona at auction. The properties, nine of which were bank-owned, included deeded parking spaces, flex industrial buildings, gas stations, apartment buildings, note sales, development sites, and single-family residences and condos.

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Mid-America Real Estate Corp’s investment sales team brokered the sale of Onalaska Marketplace in Onalaska, Wis. The 26k SF community shopping center was purchased by a private investor.  Mid-Am’s Carly Gallagher and Ben Wineman, along with Mid-Am Wisconsin’s Dan Rosenfeld, repped the seller, Pine Tree Commercial Realty.

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Sean Sharko, Valerie Cook, and Austin Weisenbeck, investment specialists in Marcus & Millichap’s Chicago Oak Brook office, repped the seller, an LLC (Sean and Austin also repped the buyer), in the $4.4M sale of a Fresenius-anchored, 31k SF value-add retail center in Glendale Heights. Fresenius occupies 39% of the center in a net lease, and Plato’s Closet occupies 18% of the center in a net lease.

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SVN | Chicago Commercial’s Tim Rasmussen and Olivia Czyzynski repped the seller in the $1.4M sale of a 5,500 SF former Applebee’s at 111 E Algonquin Rd in Arlington Heights. Marcus & Millichap’s Stephen Lieberman repped the buyer. A large Applebee’s franchise was placed into bankruptcy last year, resulting in the closing of many local stores.

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The Deal Sheet

Windy City RE sold its fourth building this year. 3152 W Diversey (above) sold for $2.7M to Laramar Group after the firm spent two years providing exterior repairs, completely rehabbing and tenanting the 16 rental units, and tenanting the three commercial storefronts.

LEASING

Mohr Partners managing partner Melissa Copley repped Seyfarth Shaw in its 200k SF office lease at Willis Tower, 233 S Wacker. Seyfarth’s Kelly Bufton, Carl Russo, and Tim Dahlman also worked on the assignment. US Equities Asset Management’s Mike Mazmierczak and Derek Rolison repped ownership.

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Wintrust Financial Corp signed a 188k SF lease (its largest Chicago area location) within 231 S LaSalle, including the building's iconic Grand Banking Hall. LJ Sheridan & Co's Patrick Caruso and Michael Caruso repped Wintrust. The Telos Group's Jack O'Brien and Jamey Dix repped ownership, which includes 601 W Cos and Berkley Properties. The location will house a Wintrust mortgage office, commercial banking operations, and wealth management. Wintrust also plans to upgrade the building's amenity package.

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NORC at the University of Chicago signed a 30k SF lease expansion at 55 E Monroe. The firm also signed an extension of its existing 88k SF, bringing its total footprint in the building to 118k SF. Cushman & Wakefield’s Jeff Lindenmeyer and Chris O’Leary repped NORC; GlenStar Properties’ Christian Domin repped ownership. 55 E Monroe has seen 120k-plus SF in new leasing in the last 12 months.

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Vertical Endeavors Indoor Rock Climbing opened its fifth and largest location in Glendale Heights.  The location, built by Nicros, has a 33k-plus SF footprint within 246 Windy Point Dr, a building owned by KTR Capital Partners.

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General Parts inked a 12k SF flex lease in Lombard. JBS Commercial Real Estate partners Brian Silverman and Jason Shibata repped ownership, Northbrook-based Rothbart Realty.

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360 Digital Printing signed a 6,000 SF flex lease in Carol Stream. JBS Commercial Real Estate partners Brian Silverman and Jason Shibata repped ownership, Northbrook-based Rothbart Realty.

FINANCING

HFF senior managing directors Mike Kavanau and Dave Keller, along with managing director Chris Carroll, repped Zeller Realty Group (ZRG) in securing financing for 758k SF 401 N Michigan Ave (above). Proceeds from the five-year, floating-rate loan through Blackstone Mortgage Trust will be used to enhance the property over the next three years. Upgrades to the 81% leased property will include a new lobby and 19th floor amenity package.

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HFF senior managing director Trey Morsbach and associate director De’On Collins repped Madison Core Property Fund in securing an $111.5M refi for a seven-property portfolio (96% leased) totaling 1.4M SF across five states. HFF will also service the fixed-rate loan, which an HFF correspondent life company split into a five- and seven-year tranche. The portfolio includes a 284k SF industrial property in Bolingbrook.

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CBRE Chicago’s Capital Markets Debt & Structured Finance VP John Parrett and senior analyst Jennifer Shuck secured $17.3M of permanent debt financing on behalf of student housing owner/operator Illinois Properties for the refi of a 12-property student housing portfolio in Champaign-Urbana. The properties, on and around the U of I campus, range from six to 34 units per property, totaling 163 units. The fixed-rate non-recourse financing (with a life company) consists of two cross-collateralized loans with varying maturity dates.

CONSTRUCTION & DEVELOPMENT

The Deal Sheet

Morningside Group and Crossroads Development Partners broke ground (above) on NorthShore 770, a 347-unit luxury apartment project and 101k SF Mariano’s-anchored retail center (tenants will include Fuddruckers, Panera, and PNC Bank) at 770 Skokie Blvd in Northbrook. The midrise apartment building’s amenities will include a 595-car heated garage, outdoor pool and sundeck, secure dog park, and outdoor lounges with WiFi. The public/private partnership mixed-use development is slated to open its retail component in summer 2015 and apartments in winter 2016.

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Ryan Cos, in a JV with Harrison Street, kicked off construction of Clarendale of Mokena, a $31.7M, 156-unit age-restricted senior living community that will offer independent living, assisted living, and memory care. Located at 21536 S Wolf Rd, it’s the first senior living community in Mokena. Amenities will include a bistro, pub, and billiards room; Life Care Services, another JV partner, will manage the community.

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The DuPage County Health Department broke ground on a new community center, designed by Wight & Co. It will be built on property east of the existing DCHD central office on the DuPage County government campus in Wheaton. The 33k SF building will include 133 parking spaces. The estimated cost is $11M, which will be fully funded by the DCHD. Completion is slated for fall 2015.

EXECUTIVE MOVES

Baum Realty Group added Brad Teitelbaum and Patrick Forkin as VPs in its investment sales division, focused on the sale of net lease investments on a national platform. Brad was most recently at Colliers, where he completed $100M-plus in deals over the past three years. He began his real estate career at Grubb & Ellis while attending ASU. Patrick was previously at Mid-America Real Estate Group, where he was involved in $1.2B in deals (since joining the firm in ’08). He earned his bachelor’s degree at University of Missouri.

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Colliers tapped Jason Yale as an associate and Alyssa Zerfass as a project coordinator in the firm’s retail investment services group led by Peter Block. Jason was previously an investment sales broker at Millco Investments and holds a BS in advertising from U of I at Urbana-Champaign. Alyssa was previously a marketing associate at The Shiner Group and earned a BS in PR at ISU.

BUSINESS

NAI Hiffman was awarded the management and leasing of 486k SF Naperville Woods Office Center, 1000-1100 E Warrenville Rd in Naperville (currently 98.7% occupied), by Agellan Capital Partners. Agellan REIT US purchased the property, which underwent a complete reno in ’07, last year. Dan O’Neill and Jim Adler will lease the property.