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This Week's Chicago Deal Sheet

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Many Illinois veterans suffer from homelessness, and LYND wants to do something about it. San Antonio-based LYND, which developed the EnV Chicago luxury apartment tower in River North, was founded by a Vietnam vet, so company officials consider this personal.

Timber Oaks Apartment Community
Timber Oaks apartment community in Ingleside, Ill.

Most recently, LYND helped Invest in America’s Veterans Foundation, a Florida-based nonprofit that assists impoverished service men and women find affordable housing and employment, acquire the 234-unit Timber Oaks in Ingleside and the 335-unit Prairie View community in Woodstock. LYND will manage all 569 of the affordably priced units, which will house impoverished vets.

IAVF purchases its properties with 501(c)(3) tax-free revenue bonds that it pays down with rental income. The foundation also works with veterans to secure federal government vouchers that defray some housing costs. To date, the LYND-IVAF partnership has located housing for more than 300 veterans who would otherwise be on the street.

“Illinois is one of a half-dozen states in the U.S. where veteran homelessness is a significant issue,” said LYND CEO David Lynd, whose father and company founder was an Army officer in the Vietnam War. “I am pleased that we are able to help these American heroes get back on their feet by providing them with a reliable roof over their head.”

IAVF board member Christopher Walker, an attorney with Lippes Mathias in Jacksonville, Florida, said approximately 20% to 25% of the units in any given property are set aside for veterans. “We have a goal of just under 2,000 additional units over the coming years.” 

Including the two new properties, LYND now manages nearly 1,500 apartment units in the Chicago metropolitan area.

The company has a long history with the region. In addition to its EnV project, another LYND affiliate and a partner acquired the city’s iconic John Hancock office tower five years ago.

EXECS

Stream Realty Partners hired Alex Mather as managing director of Stream Chicago. Mather will lead the strategic direction and operations of the Chicago office and its property management platform, alongside Executive Vice President of Property Management Victoria Knudson. Prior to joining Stream, Mather was with Principal Global Investors for 18 years and most recently served as managing director of asset management. He was responsible for more than $1.3B in assets totaling more than 5.9M SF.

SALES

Colliers International | Chicago arranged the sale of two Bristol Group warehouse facilities in suburban Carol Stream and Elgin. With an asking price of $7M, the 45K SF building located at 450 Tower Blvd. in Carol Stream and a 35K SF facility at 1895 Big Timber Road in Elgin sold to a private investor. Colliers’ Kelly Joyce represented the buyer while Colliers' Jeff Devine and Steve Disse represented the seller, Bristol Group. Both buildings are 100% leased.

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A joint venture partnership between Stocking Urban LLC and Next Realty LLC acquired 838–846 West Altgeld, a 12-unit multifamily property in the affluent Lincoln Park neighborhood of Chicago. The seller was a longtime private owner that in 1970 purchased and renovated the units, first completed in 1915 to house workers from Chicago’s Finkl Steel plant. Starting next spring, the new owners plan to modernize the units in phases to create more functional living spaces while maintaining their charm.  

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Hanley Investment Group Real Estate Advisors completed the sale of three single-tenant Illinois retail properties for a combined value of $5.2M. All three properties, located in Woodridge, Arlington Heights and O’Fallon, had less than eight years of lease term remaining. Jeff Lefko and Bill Asher represented the seller, a Schaumburg-based private development company, in the off-market sale of a Carrabba’s Italian Grill ground lease at 1001 West 75th St. in Woodridge. The buyer, a Dallas-based private investor, was represented by Jeff Gates of The Kase Group of San Francisco. Lefko and Asher also represented the sellers of the Chili’s Grill & Bar at 640 East Rand Road in Arlington Heights, and MedExpress Urgent Care at 1711 West Highway 50 in O’Fallon.

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100 S. Harvey in Oak Park, IL.
225-227 South Blvd. and 100 South Harvey in Oak Park, Ill.

Essex Realty Group sold two multifamily buildings with a total of 91 units in Oak Park. The buildings, 225-227 South Blvd. and 305-315 South Oak Park Ave., are two vintage courtyard-style apartment buildings located within a few blocks of one another. The price was undisclosed, but according to Cook County records, the first building sold for just over $4M, and the second for $5.3M. The unit mix consists of 35 studios, 30 one-bedrooms, 22 two-bedrooms and four commercial spaces that total nearly 3K SF. Essex Realty Group’s Doug Fisher and Kate Varde represented the seller, and Jim Darrow represented the buyer.

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Northwest Community Healthcare purchased a 124K SF office building at 3040 Salt Creek Lane in Arlington Heights. Avison Young's Mark Johnson, a Chicago-based healthcare specialist, represented NCH. The sale price was not disclosed. NCH will move its operations from 3060 Salt Creek Lane, where it occupied 50K SF. Avison Young has also been hired to sell this facility.

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Marcus & Millichap brokered the sale of three multifamily properties for just over $13M in Chicago’s Lakeview neighborhood. Kyle Stengle marketed the properties on behalf of the sellers in separate transactions. The recently sold properties are: 3426 North Southport Ave., a 6K SF mixed-use property with ground-floor retail and three apartments that sold for $3.5M; 926-928 West George St., a 13-unit property in Lakeview that traded for $3.8M; and 1106 West Newport Ave., a 24-unit building near Wrigley Field that sold for $6M.

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Starbucks in Des Plaines, IL.
The multi-tenant retail center near the intersection of Oakton and Lee in suburban Des Plaines.

Greenstone Partners completed the sales of several Chicago-area properties. It represented the seller of the 34K SF multi-tenant retail center near the intersection of Oakton and Lee in suburban Des Plaines. Built in 2006, the 100% leased asset features long-term tenants, including a Starbucks drive-thru. The firm also sold the 13K SF building at 1530 North Damen Ave. in Chicago’s Wicker Park. The building, just south of the Damen CTA Blue Line ‘L’ Station, was rehabbed in 2017 and features a single-tenant net lease with an early education operator. Greenstone also sold an 82K SF development site in Palatine. Located in the Chicago suburb’s commercial hub of Rand Road and Dundee Road, the parcel was 65% pre-leased at closing.

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Marcus & Millichap sold Riverside Apartments, a 72-unit apartment property in Rockford, Illinois, at 3701 Trilling Ave., just over 4 miles from downtown. The asset sold for $2.4M. James Ziegler, a Chicago-based senior associate, had the exclusive listing to market the property on behalf of the seller, a private investor. Ziegler also represented the buyer.

DEVELOPMENT

The Village of Winnetka has approved the designs for and construction of One Winnetka in the northern suburb of Chicago. The five-story high-end multifamily project, developed by Springbank Capital Advisors and conceptualized by Lucien Lagrange Studio founding principal Lucian Lagrange and principal My-Nga Lam, will sit adjacent to the village’s downtown train station. The classic French-style property will offer 30K SF of street-level commercial space, apartments, condos and townhome units.

LEASES

Newmark Knight Frank's Corey Chase arranged two leases — a renewal and a new lease, both in Addison — on behalf of Associated Material Handling Industries. The firm distributes lifting equipment and provides supply chain solutions. It fully occupies the 87K SF 133 North Swift Road and signed a long-term lease renewal after receiving a tenant improvement package from Bridge Development Partners, which recently purchased the building. In addition, it signed a new 10K SF lease at 1419 West Fullerton. Jim Rigney of Morken & Associates represented private ownership in the lease negotiations. 

FINANCING

KeyBank's Evanston Portfolio
KeyBank Real Estate Capital secured a $24.3M Fannie Mae, first mortgage loan for this and three other properties in Evanston.

KeyBank Real Estate Capital's Erik Storz secured a $24.3M Fannie Mae first mortgage loan for a four-property multifamily portfolio in Evanston. The properties, all built in the early 1920s, have a total of 132 units. Storz arranged the nonrecourse, fixed-rate financing with a 10-year interest-only term. The borrower will use the loan to acquire the portfolio.

THIS AND THAT

Hotel workers at the Chicago Marriott at Medical District/UIC held a one-day strike on Nov. 28 due to what they called the hotel’s unfair labor practices, principally its refusal to bargain. Housekeepers and food and beverage department workers formed a picket line outside of the hotel near the corner of Ashland Avenue and Harrison Street instead of reporting to work. The workers returned to work the next day. On May 2, the workers voted in favor of union representation by UNITE HERE Local 1. 

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Year-over-year cap rates for single-tenant net leased medical properties increased by 22 basis points at the end of Q3 2018, according to the Third Quarter Medical Sector Net Lease Report issued by The Boulder Group, a Wilmette, Illinois-based boutique real estate investment firm specializing in net lease property investments. In the third quarter, the average cap rate was 6.47%, versus 6.25% in the third quarter of 2017. For the purpose of this report, the single tenant net lease medical sector was defined as net lease medical properties priced below $10M.