This Week's Chicago Deal Sheet
Healthcare properties are hotter than ever, and they’re expanding to accommodate growing demand from aging Baby Boomers. That's good news for lenders.
Walker & Dunlop SVP John Pantone closed a $20M loan for the refi of Cottages of New Lenox, an 80-unit, 100-bed assisted living and memory care facility (above) in New Lenox. The refi was structured with three years IO using Walker & Dunlop’s bridge lending program. The borrower is an affiliate of a JV between Focus Healthcare Partners and Artemis Real Estate Partners. Since acquiring the property in ’12, the JV has grown the property’s memory care capacity and density, increased occupancy, improved operations and hired new management to oversee the property. Given the wave of 76 million Baby Boomers that many have called the "Silver Tsunami," John tells us he has a positive long-term outlook for the healthcare sector.
SALES
HFF senior managing directors Jaime Fink (recently named co-head of HFF’s national office platform) and Jeffrey Bramson, along with managing director Mark Katz and real estate analyst Bryan Rosenberg, closed the $185M sale of 550 W Adams (above), a 484k SF Class-A office tower in the West Loop. HFF marketed the property on behalf of the seller, German firm SEB Asset Management. GLL Real Estate Partners purchased the asset free and clear of existing debt for $382/RSF. The building’s major tenants include: USG; Lewis, Brisbois, Bisgaard & Smith LLP; Humana Health Plan; and JP Morgan.
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Quantum Real Estate Advisors president Chad Firsel and VP Conor Bossy brokered the sale of a dual-tenant retail building with Chipotle and Specialty’s Café on long-term leases and a freestanding McDonald’s at 28231-28251 Diehl Rd in Warrenville. The property sold for $5.7M. The seller was a local real estate investor based in Lake Bluff, and the buyer was a private investor from Eau Claire, WI.
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A 39k SF land parcel at 2125-43 W Madison St in West Town sold for $1.6M in an off-market deal. Located two blocks west of the United Center and two blocks east of Pete’s Fresh Market, this was one of the largest undeveloped sites not affiliated with the United Center. SVN|Chicago Commercial managing director Scott Maesel repped the buyer, a private investor.
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Jameson Commercial SVPs Mark Jones and Esther Berman repped the seller, a local developer, in the $2.2M sale of Grand Gurnee Plaza, a fully leased, freestanding 9,697 SF multi-tenant retail strip center at 3430 Grand Ave in Gurnee. Tenants include Sprint, Accelerated Health Systems, T-Mobile and Jimmy John’s. The buyer, RCI LLC, is a local investor.
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Kudan Group’s Scott Reinish facilitated the sale of Bevy at 215 W Ontario St in River North. The new owners of the 7,500 SF venue will open a remodeled upscale nightclub later this year.
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Interra Realty closed on two multifamily properties in Oak Park for $2.1M. An 11-unit building at 426 S Wesley Ave sold for $1.2M. Interra associate Patrick Kennelly, managing partner James Clough and managing partner Joe Smazal repped both sides in the deal. Recent capital improvements include roof, windows, plumbing and electrical service. Interra sold a mixed-use (four apartments, first floor retail space) property at 113 N Oak Park Ave (above) for $865k (7% cap rate). Joe, James and Patrick repped both sides.
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Brown Commercial Group sales assistant Brian Lindgren and senior associate Mike Antonelli sold two properties on behalf of First Merit Bank in less than 30 days. In the first deal, they sold the 5,012 SF building at 955 Grace St in Elgin to Precision Pavement Markings, repped by Exclusive Living’s Juana Fuentes. They also sold the 4,032 SF building at 957 Grace St in Elgin to LC&F Enterprises. CTK Chicago Partners’ Nick Saraceno was the cooperating broker in the deal.
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Kudan Group’s Brian Laskov completed the sale of 22833 W Armitage in Logan Square. He repped the buyers, Albert and Marlee Hasson. Chef Stephen Hasson (Sixteen, Alinea, The Signature Room) will open an Italian concept there later this year. Lievito, Italian for yeast, will have a modern diner feel.
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Jameson Commercial senior associate Michael Shiff sold an 11k SF, nine-unit mixed-use building at 2701 W Division and 1146-48 N Washtenaw in Bucktown/Humboldt Park (apartments and retail) for $1M (in place cap rate of 7.2%) to the Puerto Rican Cultural Center. The property has undergone significant renovations and the Cultural Center plans to update the apartments further and expand its local operations in the ground floor retail space on Division.
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Brown Commercial Group senior associate Trinity Scurto repped Mextel Communications in its expansion and acquisition of 800 Maple St in Bensenville. SVN|Chicago Commercial’s Olivia Czyzynski and Al Lindeman repped the seller.
LEASING
The Habitat Co announced the one-year anniversary of Hubbard Place in River North (the view, above), which achieved 95% occupancy six months ahead of schedule and exceeded pro forma by 23%. Residents began moving into the 450-unit, 43-story glass tower in October 2013. Hubbard Place was developed in a JV between Habitat and Bentall Kennedy.
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Kudan Group’s Jarret Fradin negotiated three restaurant leases in Bucktown, Lincoln Park and Old Town. He repped the owners of Lincoln Park’s Pasta Bowl, which will be opening its second location at 1852 W North Ave, replacing Manee Thai, this spring. He also repped LA-based JF Dining, which will be opening its first Midwest location of JINYA Ramen Bar at 553 W Diversey in Lincoln Park this summer. Finally, Jarret repped Big Onion Tavern Group alum Ryan Marks, of It’s All Good Chicago, in a lease at 1527 N Wells. His first venture, The Vig, will be a 4k SF sports bar opening this summer in Old Town.
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Cushman & Wakefield director Jordan Rovito and EVP Alex Smith repped Enterprise Recovery Systems in the long-term lease of a 77k SF office building at 840 S Frontage in Woodrige. The property will soon be home to ERS' rapidly growing call center operation, which will add 200 employees by the end of 2015. CBRE’s Gary Fazzio and French Commercial Realty’s Greg French co-repped ownership, 840 South Frontage Road LLC.
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Mid-America Real Estate Corp secured a new 7,790 SF retail lease on behalf of Millennium Dance Complex at 1000 W Washington Blvd in the West Loop. Mid-Am VPs Andrew Becker and Michael Wexler repped the tenant. Baum Realty Group’s Doug Renner and Trevor Jack repped the landlord. Millennium’s first Chicago location is expected to open this spring.
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Zahoransky USA signed a lease for 3,024 SF at 1601 Atlantic Dr in West Chicago. Brown Commercial Group sales assistant Brian Lindgren repped both tenant and landlord, Liberty Enterprises Bartlett.
BUSINESS
Colliers’ principals David Florent, Steven Kling and Francis Prock have been retained by Retail Properties of America to market and lease Zurich Towers (above), 1400 American Ln in Schaumburg. Zurich Towers is an 895k SF, two-building, Class-A office property adjacent to Woodfield Mall. Its primary occupant, Zurich Insurance Co, will relocate to its new build-to-suit HQ in 2016.
EXECUTIVE MOVES
Avison Young tapped David Herbert as principal, Clark Evans as senior associate and Michael Crenna as associate. All three join AY from DTZ. David will focus on advising corporate users on all aspects of real estate solutions, including capital markets services. Clark will be responsible for business development, market research and financial analysis. Michael will continue to focus on business development downtown with a focus on media and tech companies. David has been in the business for over 15 years and received his BS from Cornell and MBA from Booth. Clark has his BA from UMich, and Michael holds a BS from Indiana.
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J.H. Heck joined Bradford Allen as director, providing landlord and tenant rep in the Chicago area. J.H. has 17 years of sales experience with 10 years in real estate and finance. He was previously with Aura Real Estate and Management, where he originated and negotiated all new and renewal leases, TI analysis and construction projects at 330 S Wells and 401 S LaSalle. J.H. holds a BBA from Northwood University.
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NAI Hiffman promoted Joe Bronson and Kelly Disser to EVP and shareholder. Joe joined the industrial services group in 2010 and specializes in landlord and tenant rep for clients ranging from small entrepreneurial users to large institutional owners. Kelly joined the firm in 2008 and has experience ranging from commercial development to repping owners and tenants.
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CBRE FVP James Otto rejoined the Chicago tenant rep group. For the past two years, James worked in CBRE’s Tokyo office, focusing on the needs of multinational clients (HQ relocation, new operation rollout, regional expansion, property acquisition, labor analytics, etc.) conducting business in Japan and across the Asia-Pacific and Europe/Middle East/Africa regions.
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Brandon Muzik joined Stage Equity Partners as director of acquisitions, responsible for sourcing, underwriting and closing company transactions. He was previously senior acquisitions analyst at Ventas, where he helped close over $1.6B in healthcare real estate acquisitions and M&A transactions. Brandon holds his BA from Marquette University.
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Lee & Associates of Illinois hired Melissa Powell as VP of asset management. She brings over 20 years of experience, specializing in management of Class-A office and industrial properties. She has averaged an annual occupancy of 88% over the last decade. Prior to Lee, Melissa worked at Hines, ING Clarion Partners and Colliers.
