This Week's Chicago Deal Sheet
The Chicago industrial market continues to see strong tenant demand from large corporate healthcare, retail and e-commerce businesses, and developers are working to meet that demand, according to Avison Young research. During Q1, developers delivered 11 industrial properties larger than 20K SF and totaling 4.4M SF throughout the Chicago region. Five of those buildings were 100% leased, bringing the overall occupancy to 86%.
The Chicago region is also outperforming most national markets when it comes to rental rates. In the past 12 months, many regions saw a gap open up between average rental rates and new leases signed, according to new research from CommercialEdge, and although the widest gaps were mostly in coastal cities, Chicago was also a standout.
The largest premiums for new leases were for those in New Jersey, where in the past 12 months, new leases averaged $10.23 per SF, or 37% higher than the overall average. Boston had a 33% gap, while in Chicago the average for the past 12 months was $6.89 per SF, or 30% higher than the overall average of $5.29.
The Chicago region’s gap was surprising, CommercialEdge stated, as other Midwest markets didn't have similar experiences.
“Detroit, St. Louis, the Twin Cities and Kansas City have all had lower-than-average rates for new leases of late,” the firm stated.
Chicago-based general contracting firm Redmond launched a cannabis group. The company hired project executive Chris Atkinson, a former director of real estate and facilities at PharmaCann, to lead the effort.
Proper Title Insurance Agency expanded its commercial and residential services through several new hires. The firm added Michael Stump as assistant vice president of commercial business development, Gary Irwin as senior commercial underwriting consultant and counsel, Charity Murow as senior underwriting counsel, Michele Clement as director of title operations, Adrienne Sutton as director of post-closing and settlement services, and Cheryl Nutley as a senior escrow officer.
J.C. Anderson promoted Larry Regovic to senior project manager. Regovic joined the firm in 1991 in the field and was soon promoted to superintendent. He was promoted to estimator in 2003, then project manager a few years later.
Eazypower Corp. sold three contiguous industrial buildings at 4006 West Belden Ave., 2311 North Keystone Ave. and 2321 North Keystone Ave. in Chicago that total 100K SF. Avison Young’s Steven Kohn and Patrick Richwine represented Eazypower, which is relocating to a new corporate headquarters in Chicago’s northern suburbs. The buyer was a Chicago multi-tenant industrial investor that plans to modernize the property. The buyer retained Kohn and Richwine as marketing agents for the redevelopment project.
Industrial and Wholesale Lumber bought a 35K SF, free-standing lumberyard facility at 301 West Irving Park Road in suburban Wood Dale for $5.5M. Cawley Chicago’s Matt Garland, Andrew Maletich and Dustin Albers brokered the sale. The seller, Maher Lumber Co., was represented by Joe Bronson, Aimee Goudas and Josh Will with NAI Hiffman.
A private investor sold Comfort Suites Lake Geneva East, an 80-room hospitality property at 300 East Main St. in Lake Geneva, Wisconsin, for $6.3M. Marcus & Millichap’s Ebrahim Valliani, Michael Klar, Allan Miller and Chris Gomes marketed the property on behalf of the seller and represented the buyer, another private investor. Todd Lindblom assisted in closing this transaction as the broker of record in Wisconsin.
A local Servpro franchise bought a 61K SF industrial building on 2.77 acres less than half a mile away from Midway Airport at 5262 South Kolmar Ave. in Chicago. Servpro will improve and renovate the facility before utilizing it as an operations hub. PW Commercial Real Estate – TCN Worldwide’s Ed Wabick and Marc Hale represented the seller.
An East Coast-based investor sold for $5.1M a 16-unit building at 3501 North Pine St. in Chicago’s Lakeview neighborhood. Built in 1924, the building has eight two-bedroom, four three-bedroom and four four-bedroom residences. Interra Realty’s Joe Smazal represented the seller, while the private local buyer was represented by Interra’s Brad Feldman.
CONSTRUCTION AND DEVELOPMENT
J.C. Anderson completed an office renovation for Advantax at 2500 Westfield Drive in northwest suburban Elgin. Advantax is relocating from 200 West River Drive in St. Charles. The J.C. Anderson team was led by Mike Ruffolo and Ryan Kingsmill. BOX Studios provided the architectural services, and Savills represented the property owner.
General contractor Summit Design + Build started construction at TLC Ingredients in suburban Crest Hill, a project that entails the construction of a 55K SF addition to TLC Ingredients’ existing 40K SF warehouse. The project officially kicked off with a groundbreaking ceremony on May 11. Harris Architects is the project architect. Summit plans to complete the project in the fall.