This Week's Chicago Deal Sheet
The transformation of the Lower West Side and the I-55 Corridor in Chicago into centers for food distribution continues. Three food industry tenants took a total of about 71K SF in 2420 South Wood St., a 156K SF building developed adjacent to the Chicago International Produce Market in 2017 by Clarius Partners and Wanxiang America Real Estate Group.
Fulton Market was once the home of many food-related distributors, but its transformation into a tech and office hub has led many such tenants to seek out spaces in other submarkets, especially the ones southwest along Interstate 55, with quick access to downtown and its many restaurants.
Christopher Ranch Farms, a producer and shipper of California garlic, leased 16K SF; Four Star Foods, a local food distributor, signed a long-term lease of 24K SF; and Chicago CRED, a local startup led by former U.S. Secretary of Education Arne Duncan, took 30K SF.
“The Wood Street building is ideally located for food-related users with its proximity to downtown, adjacency to the International Produce Market and immediate expressway access via I-94 and I-55,” Lee & Associates Illinois principal Tom Condon said. “All three deals will feature a heavy percentage of temperature-controlled space among their specialized improvements.”
Condon represented Chicago CRED in its lease negotiations, while Ryan Kehoe, also with Lee & Associates, represented Christopher Ranch Farms and the firm’s Tim McCahill and Brian Vanosky represented Four Star Foods.
Paine Wetzel’s Ed Wabick, Marc Hale and Terry Lynch represented the owner in all three leases.
Chicago-based Skender promoted Clay Edwards to executive vice president and partner, one of five recent promotions. Andy Halik and Ashlee Pforr were both promoted to project executive, while Rob Shilney and Al McReynolds were promoted, respectively, to senior project manager and senior superintendent.
Matthew Alshouse joined DLA Piper’s real estate practice as a Chicago-based partner. Alshouse works across the globe, mostly for private equity clients, with a recent focus on South Koreans interested in U.S. real estate markets.
Truss, an online marketplace that helps clients lease coworking and office space, hired Kathryn Garrison as vice president of sales. Most recently, Garrison was a senior director of strategic partnerships and business development at Brookfield Properties and also was a national sales manager for the Tribune Co.
Interra Realty promoted Lucas Fryman from director to managing partner and Harrison Pinkus from associate to director. Fryman closed 32 multifamily transactions valued at $42M in 2019, company officials said. Pinkus joined Interra in 2018, and participated in five multifamily sales totaling $14.8M last year.
Ryan Companies US Inc. named Toby Veit its vice president of real estate development. Veit started at Ryan in 2017 as director of capital markets, and worked on several notable projects including Pullman Crossings in the historic Pullman neighborhood. Prior to joining Ryan, Veit worked as a Chicago-based developer for GGP.
Dayton Street Partners closed on two industrial properties in the O’Hare Airport submarket. The Chicago-based company bought 2454 Elmhurst Road, a 16K SF warehouse in Elk Grove Village with nearly 5K SF of office space. Built in 1982, it is 100% leased to Crown Roll Leaf and Associated Builders and Contractors.
In addition, it bought 2500 York Road, a 55K SF warehouse on 3.3 acres, and plans to renovate it with exterior painting, new LED lighting and selective demolition. Both properties offer quick access to O’Hare’s south cargo entrance. Dayton Street also just finished two spec developments nearby: a 132K SF distribution center in Mount Prospect, and a 116K SF distribution center in Bensenville.
The Boulder Group completed the $4.1M sale of a single-tenant net-leased PNC Bank ground lease at 5727 West Touhy Ave. in suburban Niles. Randy Blankstein and Jimmy Goodman of Boulder represented the seller, a Midwest-based investor. The buyer was a California-based private investor.
The Illinois branch of Logical Position leased a full-floor office in The Reserve at Deer Park, located at 21440 West Lake Cook Road. The digital marketing agency will occupy the entire seventh floor, totaling nearly 43K SF of the building’s 351K SF. JLL’s Rick Benoy, Doug Shehan and Erica Rogers negotiated the deal for owners 90 North Real Estate Partners and Arzan Wealth. Newmark Knight Frank’s Matthew Frazee and Stanford Scriven represented Logical Position.
Developer Sterling Bay renegotiated two existing leases at 600 West Chicago Ave., the historic, 1.6M SF former Montgomery Ward Catalog Building located along the North Branch of the Chicago River. Big Ten Network will expand from the 46K SF it occupies on the eighth floor to 58K SF. Barry Callebaut, a chocolate manufacturer, will expand from 39K SF to 56K SF. Its new office will include BC Studio, a space for customers to interact with company chefs. Sterling Bay’s Russ Cora negotiated each transaction. Savills’ Robert Sevim and Kelly Givens represented BTN. David Findling of Cushman & Wakefield represented Barry Callebaut.
JLL’s Keith Largay, Jeff Bucaro, Nicole Aguiar and Brian Walsh arranged a $57M refinance loan for Home2Suites by Hilton Chicago River North, a 206-suite hotel that opened in February 2019. Borrower Akara Partners will use the proceeds to refinance its construction loan.
CONSTRUCTION AND DEVELOPMENT
Evergreen Real Estate Group, along with 47th Ward Alderman Matt Martin, officials from the Chicago Housing Authority and other partners, held a public groundbreaking Thursday afternoon for Ravenswood Senior Living, a 193-unit affordable rental community at 4515 North Winchester Ave. in Chicago’s Ravenswood neighborhood. The project will transform the vacant former Ravenswood Hospital into an affordable senior housing building. It will have 74 one-bedroom apartments for CHA tenants, as well as 119 units reserved as alternatives to nursing homes.
Minneapolis-based Artspace Projects Inc., along with its partners Chicago Neighborhood Initiatives and PullmanArts, has nearly completed Pullman Artspace Lofts, a live-work space for artists in the Pullman neighborhood. CNI officials said it is the neighborhood's first new significant residential development in about 50 years. The project, designed by architecture firm Stantec, includes two restored apartment buildings, along with a newly constructed residence, and provides 38 rental apartments and a 2K SF community space.
THIS AND THAT
WeWork, at 1M SF, leases nearly triple the space in Chicago of any other coworking provider, according to Savills and Workthere’s report called The Flex Machine, which tracks the coworking and flexible office market across the U.S. Regus came in second at 370K SF, followed by Convene with 335K SF, Industrious with 267K SF and Novel Coworking at 195K SF. Flexible office providers lease about 3.4M SF in the city, or roughly 2.4% of the city’s inventory, with almost half that space in the Loop.