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This Week's Chicago Deal Sheet

The first quarter ended in uncertainty, but for the first few weeks of the year, suburban office tenants leased space at a quickening pace. Including new leases and lease expansions, suburban tenants signed deals for a total of 1.7M SF in Q1, up from 1.3M SF in Q4 2019, according to the latest statistics from Colliers International.


That does not mean the region is healthy. It started off the year with 405K SF of negative absorption, and the vacancy rate rose 40 basis points to 22.4%, up 80 basis points from a year ago, the firm found. Vacancy also increased within Class-A properties, rising to 23.2%, also up 80 basis points from a year ago.

But trophy assets in the suburban office market continue to outperform other sectors, and now have an average vacancy rate of 17.7%, according to Colliers.

Certain submarkets also outperform others in the region. The office properties around O’Hare International Airport have a vacancy rate of 16.3%, compared to 30.7% in the Northwest suburbs, and between 19.5% and 20.4% in the North suburbs, Lisle-Naperville and Oak Brook.  

But the suburbs all shared one feature: a dearth of property sales.

“Investment and user sale velocity stalled in the suburban office market as only one asset traded hands in the first quarter of 2020, while five assets were added to the market,” Colliers said.


Logistics specialist Dermody Properties hired Mary Tortorici as its Chicago-based vice president of property management. Tortorici will lead all day-to-day management of the company’s properties and customers in the Midwest, East and Southeast regions. Prior to joining Dermody, she served as senior property manager for Liberty Property Trust, where she led operations for 8M SF of logistics properties in the Chicago area.


InvenTrust Properties Corp. appointed Matthew Hendy to senior vice president of operations. Hendy has more than 15 years of operations experience in the retail and mixed-use real estate sectors. He most recently served as vice president, market officer, at Regency Centers.


Law firm Akerman LLP hired Joel Sestito to its real estate finance practice in Chicago. Akerman's Chicago office, founded in 2014, has grown to more than 50 lawyers.


Berkadia added two managing directors to its Chicago mortgage banking team. Steve Skok and Jason Bond both come from JLL, which they joined as part of the organization’s acquisition of HFF. Skok has also worked at Cohen Financial, Lincoln Property Co. and CBRE. Bond has worked for Deutsche Bank, Berkshire Mortgage, Wintrust and MB Financial Bank.

990 South Barrington Road, Streamwood, Ill.


A Southwest-based private real estate company bought a new net-leased Andigo Credit Union property at 990 South Barrington Road in suburban Streamwood. The $2.25M deal was brokered by The Boulder Group, a Wilmette, Illinois-based firm. The credit union is an outparcel to an LA Fitness-anchored shopping center, where LA Fitness recently signed a new 15-year lease. Randy Blankstein and Jimmy Goodman of Boulder represented the seller, a Midwest-based real estate group. Andigo also has a 15-year lease.


A Texas-based buyer acquired for $5.22M a 14K SF net-leased property at 9551 171st St. in suburban Tinley Park. The property is a build-to-suit for CVS, which has a long-term lease. Marcus & Millichap’s Matt Emerick, Austin Weisenbeck and Sean Sharko listed the property on behalf of the seller, a developer.   


A 60-unit apartment property at 495-525 Madison Ave. in southeast suburban Calumet City was sold to a private buyer for $3.58M, according to real estate information site Reonomy. Marcus & Millichap’s Andrean Angelov and Ryan Engle marketed the property on behalf of the seller, a private investor, and represented the buyer. The five 12-unit buildings occupy a 1.3-acre lot. The property was last sold by Community Initiatives Inc. for $1.23M in 2012, according to Cook County records.

9450 Sergo Drive, McCook, Ill.


American Tire Distributors extended its 233K SF lease at ML Realty Partners’ 9450 Sergo Drive in suburban McCook. Chris Mason of Newmark Knight Frank represented ATD.


Sonova signed a new 63K SF lease at Stanton Road Capital’s 750 North Commons Drive in Aurora. In mid-June, the Switzerland-based hearing care manufacturer will bring together three existing operations — two from Illinois and one from Minnesota — at the new location, a 205K SF, two-building property with industrial and office space.

Stanton Road purchased it in 2018 and began creating “The Outpost,” a tenant-amenity space featuring a fitness center, renovated lobby and lounge. Colliers International | Chicago’s Sven Sykes, Tom Volini and Brent Jacob represented Sonova. Francis Prock, Dave Florent and Brian Kling of Colliers are the property’s leasing agents.

4200 On The Lake


Chicago-based M&R Development began construction on 4200 On The Lake, a 236-unit apartment building on Lake Michigan in St. Francis, Wisconsin, a southern suburb of Milwaukee. M&R, which is co-developing the project with Campbell Capital Group, plans to deliver the building in spring 2021.

4200 On The Lake will include a large open courtyard with an outdoor swimming pool and a sun ledge overlooking the water. CICB provided project financing. Madison, Wisconsin-based Stevens Construction is serving as general contractor, and RMK Management will handle leasing and property management. 


PREMIER Design + Build Group delivered a 153K SF speculative distribution warehouse for Chicago-based developer Sterling Bay and its partner DWS Group. The building occupies a 9-acre site at 1035 South Frontage Road in Darien about 25 miles southwest of Chicago. Sterling Bay and NAI Hiffman recently secured a tenant that will occupy 90K SF. PREMIER’s team included Joseph Ahrens, Gary Schlinger, Ron Nelsen and Michael Long. Cornerstone Architects provided design services and Spaceco handled civil engineering. 


Oak Brook, Illinois-based Gage Consulting Engineers merged with TLC Engineering Solutions, a national firm with 15 offices. Gage has been operating in the Chicagoland region for 25 years, and now has the opportunity to expand in the Midwest and other regions, company officials say. This marks TLC’s first Midwest presence after 65 years in business.