This Week's Chicago Deal Sheet

A partnership between Sterling Bay Industrial, Development Resources and Levy Family Partners sold Butterfield VI Distribution Center, a new industrial facility at 2350 Frieder Lane in west suburban Aurora, to an unnamed institutional investor for an undisclosed price. Built in 2020, the 503K SF warehouse sits on 34.5 acres and features a 36-foot ceiling height. LGSTX Distribution Services leases two-thirds of the building.

Colliers International Chicago’s Jeff Devine and Steve Disse represented the Sterling Bay partnership. 

“E-commerce continues to drive demand for well-located, modern product,” Devine stated in a press release. “This was an exceptional opportunity for the buyer to acquire an asset with tremendous upside and increase its yield via the building’s remaining vacancy.”

The facility is within the master-planned Butterfield Center for Business and Industry business park on the eastern edge of Chicagoland’s east/west corridor. Two recently reconstructed four-way intersections with I-88 at Eola Road and Route 59 serve the facility. Amazon, FedEx, UPS, International Paper and Kapstone are among the companies that occupy space in the park.

EXECS

Duke Realty Corp., an Indianapolis-based logistics property REIT, promoted Susan Bergdoll to senior vice president of leasing and development and regional leader for its Chicago, Minneapolis and Indianapolis markets. She started her career by joining Duke’s marketing department in 1997. In 2005, the Chicago-based Bergdoll was promoted to vice president of leasing, and in 2016, she was promoted to vice president of leasing and development.

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First Hospitality appointed Jason Hutcheson to vice president of investments. Prior to joining First Hospitality, Hutcheson worked for AJ Capital Partners as an associate supporting acquisitions, developments and capital markets. He also spent four years working for CBRE, most recently as a senior financial analyst.

SALES

Bridge Development Partners acquired a 9.24-acre site at 5300 Belmont Road in suburban Downers Grove on which it will develop Bridge Point Downers Grove Phase 3, a 126K SF industrial facility with a 32-foot ceiling height. The company will demolish the site's existing building and begin construction in summer 2021. Bridge expects to deliver the project in Q4. CBRE represented the seller, and Bridge was represented by Sean Henrick and David Friedland of Cushman & Wakefield.

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Dalfen Industrial purchased Butterfield Logistics Center, a 174K SF industrial facility at 1103 Butterfield Road in west suburban Aurora. Brendan Sheahan and Nick Krejci of Darwin Realty/CORFAC International brought the opportunity to Dalfen and now handle leasing for the building, which was built in 2004.

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A private local investor bought 700 West Grace St., a 16-unit rental property in Chicago’s Lakeview neighborhood, for $5.7M. Interra Realty’s Joe Smazal represented the East Coast-based seller and the buyer. Constructed in 1916, the three-story property is located at the southeast corner of Grace Street and Pine Grove Avenue.

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HAK Management sold 1001 Fargo Ave. in Elk Grove Village, a 31K SF, free-standing warehouse facility. A Cawley Chicago team consisting of Andrew Maletich, Matt Garland and Dustin Albers represented HAK. The buyer was represented by Brown Commercial’s Trinity Scurto. 

LEASES

Aspen Dental Management leased an additional 11K SF at 800 West Fulton Market, a new 19-story mixed-use building developed by joint venture partners Thor Equities Group and QuadReal. The move expands Aspen’s total space to 208K SF. It originally signed a long-term deal to occupy eight floors in the building, designed by Skidmore, Owings & Merrill, just before the coronavirus pandemic hit. In addition to its national headquarters office, Aspen will occupy 8K SF of retail space on West Fulton Market.

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Wolf Point East, a new 698-unit luxury apartment building just west of The Merchandise Mart in River North, hit the 80%-leased milestone. Developed by Hines, the Kennedy Family and the AFL-CIO Building Investment Trust, Wolf Point East was designed by Pelli Clarke Pelli Architects in partnership with Pappageorge Haymes Partners. Luxury Living Chicago Realty handles leasing efforts for the property.

In addition, Oakland-based Blue Bottle Coffee will open in the ground-floor retail space in summer 2021. It will be its first Chicago location.

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Rubinos and Mesia Engineers signed a 10K SF, 10-year lease renewal at 200 South Michigan Ave. The engineering firm will remain on the 15th floor of the office tower, where it has been a tenant for more than 30 years. Bradford Allen’s Ben Azulay represented RME in the transaction, and Craig Coupe of JLL represented the landlord.

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Garage Door Supplies signed a sublease for 30K SF at 6558 West 73rd St. in southwest suburban Bedford Park. Darwin Realty/CORFAC International’s Jeffrey Provenza and Rollo Dace represented the manufacturer and distributor of garage doors and related parts. Cushman & Wakefield’s William Strey represented the sublandlord, Jerich USA.

FINANCING

PGIM Real Estate provided a $41M loan to Dalfen Industrial for the acquisition of a three-building industrial portfolio with properties in the Las Vegas and Chicago metro areas, including Aurora’s Butterfield Logistics Center. Totaling about 438K SF, the portfolio also includes AirParc South and Suncrest Commerce Center in Henderson, Nevada.

CONSTRUCTION AND DEVELOPMENT 

James McHugh Construction Co. and Brown & Momen started construction on 508 Pershing at Oakwood Shores, a 53-unit mixed-use, mixed-income rental community at 508 East Pershing Road. A public-private partnership led by The Community Builders, the building is part of Oakwood Shores, a 100-acre redevelopment of several Chicago Housing Authority communities in the Bronzeville neighborhood about 3.5 miles south of downtown Chicago. Designed by Nia Architects and Antunovich Associates, the four-story building will include more than 3K SF of retail. The developers expect to complete the $17.1M project by February.

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The Opus Group completed WEN Power Tools’ headquarters in northwest suburban West Dundee. WEN consolidated three local facilities into the 180K SF building. It features 4K SF of office space and a nearly 2K SF showroom. Opus was the developer, design-builder, interior designer, architect and structural engineer. It was Opus’ eighth project in Oakview Corporate Park.

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Interfaith Housing Development Corp. completed Fifth Avenue Apartments, a 72-unit affordable housing development at 800 South Fifth Ave. in west suburban Maywood. The Illinois Housing Development Authority, the Cook County Department of Planning and Development, the Richman Group Affordable Housing Corp., Bank of America and the Chicago Community Loan Fund helped finance the development. Architecture and engineering firm HED designed the building with off-site prefabricated architectural precast panels, allowing Chicago-based McShane Construction Co. to assemble the structure in 35 days.

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J.C. Anderson completed a 33K SF spec suite build-out for Beacon Capital Partners at 303 East Wacker Drive in Chicago, a 30-story, 944K SF building on the East Loop riverfront. The builder added offices, an on-site bar, lounge, training spaces and conference rooms. A set of ready-to-use suites called “The Hive” can accommodate multiple tenants ranging from nearly 2K SF to more than 5K SF. J.C. Anderson’s team was led by Joe Hynes, Jason Hawkins and Steve Perry. Whitney Architects provided architectural services, and Kent Consulting provided engineering services.

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Lincoln Property Co. and Calamos Real Estate selected McShane Construction Co. to add a new mixed-use multifamily development to west suburban Naperville’s CityGate Centre. Known as Lincoln at CityGate, the 285-unit project will also feature a 430-space parking garage and the 38K SF shell for a future rooftop event center. The development will include four wood-frame construction stories wrapped around the precast garage. McShane expects to complete the project by February 2023. The architect of record is CallisonRTKL.

THIS AND THAT

Chicago-area developers will add 16.9M SF of industrial space across 37 projects in 2021, making it the third-most-active U.S. market this year, according to CommercialSearch’s 2021 Industrial Pipeline Report. The largest local industrial project that will come online in 2021 is the 1.4M SF Medline Grayslake Distribution Center. The largest Chicago-area project completed in 2020 was the 1.5M SF Building 1 of Project Jupiter in southwest suburban Plainfield.

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Chicago generated the nation's third-largest number of renter applications in 2020, exceeded only by Los Angeles and New York City, according to STORAGECafé, which analyzed 1.7 million renter applications. The researchers found a massive slowdown in Chicago during the first half of the year, but renter activity resumed in the second half, especially in the city’s core submarkets, with many renters favoring apartments in The Loop, Streeterville and Logan Square. More than one-third of 2020 renters were moving from the urban core to the suburbs or outer Chicago neighborhoods, while 40% of renters were swapping the suburbs for downtown Chicago.