The Deal Sheet
In a healthcare real estate market driven by consolidation, big name hospital systems will always be the first to draw investor eyeballs. (Especially if they were worried about losing those eyeballs.)
Avison Young’s capital markets team, led by principals Erik Foster and Mike Wilson, just sold the Tenet Healthcare MacNeal Hospital medical office portfolio (above) in Berwyn to Philadelphia-based Patriot Equities. The portfolio was sold on behalf of Heitman and includes three buildings (3340 S Oak Park Ave, 3300 S Oak Park Ave, 6804 Windsor) totaling 96k SF. It is leased to Tenet Healthcare’s MacNeal Hospital under a long-term lease. A large amount of capital around the country continues to chase hard-to-find high-quality MOB deals, Erik and Mike say, driving the market to record valuations. Demographic trends (aging Baby Boomers, a larger insured patient pool under the ACA) should increase demand for healthcare for the foreseeable future, they tell us. Combined with hospital systems pushing care to outpatient settings (i.e. MOBs), this should fuel a healthcare upswing so feverish we'll probably need a cold compress.
SALES
The Boulder Group completed the $6.7M sale of a single-tenant NNN Walgreens at 28895 W Hwy 120 (above) in Lakemoor. Walgreens has 25 years of lease-term remaining at the 15k SF, new construction property. Boulder’s Randy Blankstein and Jimmy Goodman repped both the seller, a Midwest-based developer, and the buyer, a private investor in a 1031 exchange.
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Kudan Group’s Jarrett Fradin facilitated the sale and lease at 1132 Taylor St, formerly Sofia’s Pizza, in University Village/Little Italy. The owners of Big G’s Pizza in Wrigleyville will bring their creative pizza concept to the neighborhood in July.
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Chicago Real Estate Resources’ Michael Tolliver repped the seller, a local bank, in the sale of a portfolio containing 34 notes secured by multifamily properties in the Chicago metro area. Bob Floss & Son Realty’s Michael Cicchinelli repped the buyer, an international investor.
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Transwestern principal John Joyce, senior associate Ryan Phillips, and associate Chris Rickett repped Tropokinesis in its $1.6M purchase of 2510 Green Bay Rd in Evanston (formerly home to Domicile Furniture) from a private investor, Laurence Bauman. The firm will be relocating from its previous location at 1515 Sherman in Evanston. SVN | Chicago Commercial’s John Hancko repped the seller.
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First Western Properties’ Kellen Duggan and Paul Tsakiris completed the sale of a bank-owned, three-storefront building at 422 E 87th St to an owner occupier who will collect income on two occupied storefronts. Paul also sold a 25-unit, bank-owned multifamily building at 7849-53 S Coles Ave, along with the lease and sale of 6743 S Western Ave to EZ Pawn.
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Jameson Commercial’s Ari Topper and Chris Irwin completed the $1.1M sale of 1755 W North Ave, a three-unit, stabilized commercial condo in Bucktown. The buyer was a local investor repped by Colliers’ Brad Teitelbaum.
LEASING
JLL just signed an LOI with Piedmont Office Realty Trust to extend its current 165k SF global HQ lease at the Aon Center (above) once it expires in 2017. The firm will also overhaul its office into a more collaborative and high-tech environment, with the first group of employees moving into the new space by mid-2015. JLL managing directors Jeff Liljeberg, Rob Schmidt, and Michael Sessa are repping JLL in the lease negotiations; managing director Steve Smith and VP Mark Georgas are repping Piedmont.
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Berlin Packaging, repped by JLL’s Chris Watts and Kurt Sarbaugh, has signed a lease for 125k SF of space in a 237k SF spec building at 900 Windham Pkwy in the Windham Lakes Commerce Center. The buildings developer/owner, a JV between Seefried Properties and Clarion Partners, was repped by JLL’s Trevor Ragsdale and Grant Glattly.
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@properties Commercial recently brokered five retail and office leases: senior consultant Rebecca Lundstrom repped ownership, Swim Café, in a five-year, 1,400 SF lease with Awake Café at 1357 W Chicago Ave in Noble Square, and also repped ownership, Hocho LLC, in a 1,600 SF lease with Waffles (repped by Sierra US’s Anthony Ciaravino) at 203 E Ohio in Streeterville; Joseph Kunst and Michael Tetuan brokered a three-year, 1,800 SF lease for Grande Fit at 325 W Northwest Hwy in Palatine (owned by Steven Ross LLC); senior broker Lee Ffrench repped Big Teeth Productions in a two-year, 2,000 SF lease at 4001 N Ravenswood in Lakeview (owned by Hayes Properties); and senior broker Larry Cohn repped Builders Bank in a five-year, 5,156 SF lease at 203 N LaSalle in the Loop (Lee repped ownership, Interpark).
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Mercenary Brewery & Distillery (owned by Adam Cieslak, Ari Megalis, and Paul Megalis), the first facility in the state to brew craft beers and distill spirits under one roof, will open this summer after signing a nine-year lease for 7,000 SF of warehouse space at 2717 N Maplewood Ave in Logan Square. @properties’ Anthony Rouches repped Mercenary and Royal Lichter repped ownership, Lichter Realty.
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Entre Commercial Realty repped Aptargroup in a three-year lease renewal for its 138k SF space within two buildings at 801 and 901 Technology Dr in Libertyville. Entre Commercial Realty’s Dan Benassi, Dan Jones, and Michael DeSerto repped the tenant. The building owner, John Hancock Real Estate, was repped in-house by Dan Shapiro and Christine Choi.
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Wolverine Trading and its affiliates extended their lease agreement at 171 W Jackson Blvd, totaling 88k SF. Savills Studley executive managing director Robert Sevim co-brokered the deal with Steinco’s David Stein, both repping Wolverine. JMIC Corp’s Sean Murphy repped the landlord. This is the first sizeable deal for the building since it was refinanced late last year.
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C Fish-House Chicago, the third venture by Chicago Cut’s David Flom and Matt Moore, will open in The Alter Group’s 20 W Kinzie, a 385k SF Class A office building in River North. The space will include an open-air kitchen with a fish bar, sushi station, and oyster bar. Newmark Grubb Knight Frank's Matthew Ward is the exclusive leasing rep for the building.
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Mid-America Asset Management secured four new retail leases on behalf of three lifestyle shopping centers: Pure Mountain Co leased 8,824 SF at 579k SF Algonquin Commons in Algonquin (Mid-Am principal/VP Marget Graham and leasing rep Samantha Spinell repped the landlord, Premier Commercial Realty’s Linda Kost and Dave Schmimdt repped the tenant); The Dailey Method signed a 2,034 SF lease at 49k SF Orland Park Crossing in Orland Park (Mid-Am leasing reps Paige Winkels and Samantha repped the landlord, Schramko Real Estate’s Angela Ricardoti repped the tenant); and Victoria’s Secret and Color Me Mine signed leases for 6,500 SF and 1,048 SF, respectively, at 438k SF Geneva Commons in Geneva (Marget and Samantha repped the landlord).
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Consumer Digest Communications signed a 9,987 SF long-term lease renewal at 520 Lake Cook Rd. The publisher has operated out of its Deerfield location for the past 10 years. Bradford Allen senior managing director Ben Azulay repped Consumer Digest Communications in the transaction. Colliers’ Chris Cummins and Steve Kling repped the landlord, Arden Realty.
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NAI Hiffman EVP Patrick Kiefer repped American Realty Advisors in multiple lease renewals and expansions totaling more than 55k SF of office space at Regency Towers, 1415-1515 W 22nd St in Oak Brook. The deals include Bancorp Financial, Rasmussen College, John Wiley & Sons, and Moet Hennessy USA. Oak Brook Regency Towers consists of two multi-story Class A office buildings joined by a one-story retail concourse.
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Community Threads, repped by Colliers EVP David Gelfand, signed a 22k SF lease at Arlington Plaza, 250 W Rand Rd in Arlington Heights, a significant lease expansion and relo from 13k SF at a retail center in Buffalo Grove. The space was formerly occupied in a similar capacity by the Salvation Army. Cindy Saxman Spivack repped ownership, Robin Realty and Management.
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Cornery Bakery Café will open its first Wisconsin location later this year at HSA Commercial’s The Mayfair Collection in Wauwatosa, Wis. Neo Fourno, a franchise partner of CBC Restaurant Corp, will operate the 4,000 SF location. HSA Commercial will break ground next month on the second phase of the development, to be anchored by Whole Foods and a 140-room Hilton Homewood Suites.
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First Western Properties’ Paul Tsakiris and Tom Peterson leased space at 8100 S Stony Island Ave to a beauty supply store. First Western’s Kellen Duggan also completed a lease at the former Homeade Pizza Co at 421 Harlem Ave in Oak Park.
FINANCING
First Eagle Bank closed a $1.1M construction loan for a three-unit condo building at 1545 W Montana in Lincoln Park for 1545 Montana LLC, and a $1.2M refi of a commercial warehouse and office building at 1520 W Fulton in the West Loop with a working capital line of credit for entities relating to food photographer Steve Hamilton Inc.
CONSTRUCTION & DEVELOPMENT
Conor Commercial Real Estate completed a new 347k SF build-to-suit corporate HQ and warehouse facility (above) for Orbus Exhibit & Display Group. The building is situated within Union Pointe in Woodridge, an 80-acre industrial/office business park and venture of Conor Commercial and Gallagher and Henry. Colliers’ Jack Rosenberg and Fred Regnery repped Orbus in the lease. NGKF’s Brian Carroll and Jim Cummings repped ownership.
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Molto Properties will develop a 190k SF, state-of-the-art distribution facility in Romeoville, located on 10.67 acres at 1485 Normantown. Collier’s Jim Estus repped the seller and will market the spec building on behalf of Molto. Delivery is slated for late 2014.
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The LaSalle Group will open the first freestanding memory care community in South Barrington (NE corner of Higgins and Bartlett Road), Autumn Leaves of South Barrington, next month. The 29k SF, $11.1M memory care community will provide specialized care to nearly 50 residents. The LaSalle Group has nine communities open or under construction in the Chicago suburbs.
EXECUTIVE MOVES
MB Real Estate tapped Chris Dilley as VP in its healthcare division, overseeing asset management for the firm’s healthcare properties across the country. He was previously AVP in GE Capital’s real estate group, where he closed more than 100 loans. Chris is a vet of the US Air Force, received his BS in business administration from Regis University in Denver, and is working toward his MBA at Indiana.
KUDOS
M&R Development’s Central Station, an 80-unit luxury apartment building at 1720 Central St in Evanston, was awarded LEED Gold by the US Green Building Council. It is the first new construction suburban rental to be awarded the designation. The building earned LEED credits for features such as electric car charging stations, a green roof, and Energy Star-rated appliances.
