This Week's Chicago Deal Sheet
The St. Clair Hotel, the first property in The Red Collection, a new Red Roof brand that is more expensive than standard Red Roof properties, is preparing a soft opening at 162 East Ontario St. in Streeterville.
The building dates from the 1920s and has more recently been known as the Inn of Chicago. As part of The Red Collection, the property is reverting to its original name, St. Clair Hotel, and its 208 rooms have been renovated and upgraded. Guests can also expect a restaurant on premises in the future.
According to Red Roof, the company is entering a new sector with The Red Collection: upper midscale city center hotels that aim to reflect the local culture of the city. Red Roof said its research shows that many travelers aren't looking for trendy or hip hotels, but rather city lodging with enhanced amenities.
"The St. Clair Hotel is the flagship property of The Red Collection, a new soft brand that provides access to new markets and audiences for us," Red Roof President Andrew Alexander said in a statement. "Because there is already core equity in Red Roof, this is the time for us to grow our portfolio as we build on our strong brand base."
Red Roof's efforts to make the The St. Clair Hotel local include Chicago-themed souvenir kits in each room. The hotel also offers some rooms with two king-sized beds, and such rooms also feature a white noise machine.
Franchisee Packard Hospitality Management is introducing the first franchise property of The Red Collection, the 125-room State House Inn in Downtown Springfield, Illinois, later this fall. Future cities under consideration for The Red Collection include New York, Las Vegas, Charlotte, Austin and Atlanta.
EXECS
ML Realty Partners has promoted Patrick Shannon to senior vice president. In his new role, Shannon will lead the leasing and acquisition efforts for the company in the Chicagoland market.
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Kathleen Bertrand has joined Transwestern Chicago’s agency leasing team. Bertrand came to Transwestern from MB, where she managed the office and retail leasing of 2.5M SF, with notable projects including Michigan Plaza and 500 West Washington.
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Clear Height Properties, a Chicago-based real estate investment and management firm, has hired three new people: Monika Cepatis as property manager, Ryan Ferris asassociate property manager and Tom Kuczek as accounting associate.
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Summit Design + Build has hired Ken Swartz as a vice president. In that position, Swartz will assist in managing the overall operations of the firm, and will review and improve internal operations, including human resources, billing and cash flow, and contract review.
LEASES
HR Source has inked an 11K SF lease renewal and extension at 3025 Highland Parkway (Highland Landmark II) in Downers Grove. Formerly known as the Management Association of Illinois, the organization recently rebranded as HR Source. NKF Senior Managing Director Corey Chase represented HR Source in the deal, while JLL's Jeff Shay, Karla Harmon and Steve Flachbart represented ownership, the Estate of James Campbell Company LLC.
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DTE Enterprises, a provider of power train components for the mining, oil and gas, metals and wind generation industries, has leased 86K SF at 2350 West Pinehurst Blvd. in Addison. NAI Hiffman Executive Vice President Jeff Fischer and Associate Pat Hart represented owner Gateway Industrial Properties in the transaction. Gateway is a Blackstone industrial portfolio company. The deal brings 2350 West Pinehurst Blvd. to 100% occupancy.
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CBRE represented Impact Networking, a managed service provider, in a 13-year renewal and expansion to 19K SF at 150 North Michigan Ave. in Downtown Chicago. Impact is expanding from its current 7K SF space on the 21st floor to lease the top two floors, the 40th and 41st. The company will initiate a build-out of the property’s penthouse suite, developing a branded workplace. As part of the deal, Impact will also receive prominent logo visibility and signage on the street-level of the building.
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Application Software Technology is leasing 11K SF at the 168K SF Olympian Office Center at 4343 Commerce Court in Lisle. The Missner Group will build out the space to include an open-office concept, along with a number of private executive suites, reception areas, high-end conferencing facilities and employee lounge areas.
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Club Pilates is growing fast. By the end of 2018, Club Pilates will have 23 locations open in the Chicago area, according to the company. Club Pilates has opened studios in the market so far in Algonquin, Glen Ellyn, Highland Park, La Grange, Lincoln Park, North Buffalo Grove, North Center, Oak Park, Park Ridge, Schaumburg, South Naperville, St. Charles, West Loop and Westmont. Additional locations will open later this year in Mount Prospect, Glenview, Libertyville, North Naperville, Bloomingdale, Oak Park, Old Town in Chicago, Evanston and Elmhurst.
SALES
Robert and Michael Prosser, restaurateurs known for the Hoffman House Restaurant and Henrici's Catering, have acquired the Pavilion and Copperstone Inn at Orchard Ridge Farms in Rockton, an upscale wedding and event venue. Henrici's Catering has been the caterer for The Pavilion for the past five years, during which time it has participated in over 500 events. The sellers of the 70-acre property in Winnebago County are Richard and Chrissie Spanton.
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Marcus & Millichap's Andrean Angelov, Ryan Engle and Samuel Antreasian brokered the sale of an 18-unit apartment property at 2628-2640 Desplaines Ave. in North Riverside, which sold for just over $2M.
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Lee & Associates has facilitated the $3M sale of a 51K SF industrial building at 1100 Commerce Drive in West Chicago. Jeff Janda, principal of Lee & Associates’ Illinois office, and Mike Wolfe, senior vice president of Lee & Associates’ Ontario, California, office, represented the buyer, Tradition Asset Management. Mike Weaver of Chicago Real Estate represented the seller.
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Kiser Group has brokered the sale of 1940 Sherman Ave. and 829 Foster St. in Evanston for about $17M. The private buyer bought the 87-unit apartment portfolio, which includes a small amount of retail, from Stephen Matic. The deal was facilitated by Kiser Group’s Danny Mantis and Lee Kiser.
DEVELOPMENT
Skender has completed the Northwestern Medicine Immediate Care Clinic in the West Loop, a 5,500 SF build-out in a new core-and-shell building at 171 North Aberdeen. The property features six exam rooms, an x-ray room, infusion treatment areas, laboratory space, staff lounge and work areas, and an internal mechanical room with a stand-alone air handling unit.
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Silver Glen Senior Living is now under development in South Elgin by Spectrum Retirement Communities. On 10 acres, the community is slated to open in mid-2020. Silver Glen Senior Living will offer 179 residences, including independent living, assisted living, memory care and a transitional memory care program that gives seniors their independence while supporting issues related to mild cognitive impairment. Spectrum will own and operate it; Silver Glen is its eighth community in the Chicago area.
FINANCE
Mesirow Financial has closed Mesirow Financial Real Estate Value Fund III, with equity commitments of $567M from institutional investors in the U.S., Europe and Australia. The fund is managed by Mesirow Financial’s Real Estate–Direct team, which employs a value-added real estate strategy focused on the U.S. multifamily sector, with a secondary focus on the student housing sector. The fund will build on the track record of Funds I and II, and position the team to acquire more than $1.6B in real estate assets.
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Chicago-based Konnect Real Estate has launched a privately held real estate debt fund, KNCT Lending, focused on short-term and transitional capital. The fund’s goals are to provide real estate owners and operators with low loan minimums, ranging from $250K to $3M.
THIS AND THAT
The Appraisal Institute has unveiled an information system that classifies and describes property uses and assists real estate analysts and others with their property use data storage and analysis. The new Property Use Classification System contains a large number of property types and property subtypes, inclusive of the hundreds of property types that appraisers regularly value, and even newly developed uses such as energy, rock-climbing facilities, recycling centers, waste transfer stations and intermodal properties.
