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Hines has acquired a two-building, 1.1 million-square-foot industrial campus at 4700/4800 and 5000 Proviso Drive in the Chicago suburb of Melrose Park, Ill. Image courtesy of Hines
Hines has acquired the Chicago Prime Portfolio, a two-building, 1.1 million-square-foot industrial campus at 4700/4800 and 5000 Proviso Drive in the Chicago suburb of Melrose Park, Ill. The seller was AEW Capital Management, according to CommercialEdge data.
The Chicago Prime Portfolio consists of two industrial facilities with 32- and 35-foot clear ceilings, one dock per 5,000 square feet, 159 trailer parking positions, and dual rail loading.
The portfolio is 100 percent leased to three logistics tenants that have all occupied their spaces for about 20 years.
READ ALSO: Are Suburban Office-to-Industrial Conversions Feasible?
The campus is close to the Union Pacific Global 2 intermodal terminal in Northlake, the I-294 / I-290 interchange, the I-294/I-290/I-88 interchange, the future I-490/I-294 interchange and Chicago O’Hare International airport.
Hines will serve as the portfolio’s property manager and intends to implement “a strategic value-add capital improvement plan” there.
CBRE represented AEW Capital Management in the transaction.
Tight market
In a prepared statement, Will Renner, senior managing director at Hines, described the portfolio as “a compelling opportunity given its strategic infill location in the densely populated O’Hare submarket.”
The statement added that this submarket has “attractive fundamentals, limited supply and robust demand. Bulk industrial sites in particular are scarce and challenging to develop in this submarket.”
Industrial leasing in Chicagoland this year has been characterized by slower activity and a sharp rise in renewals, according to a third-quarter report from Avison Young, which commented that the leasing slowdown “is particularly significant as it marks the first time, we have observed such a notable drop.”
Still, a nearly 21 percent year-over-year decrease in deliveries has helped to hold overall vacancy at 4.5 percent and bolster rents, which have risen by 24.7 percent since 2019.
The O’Hare submarket is seeing a stable vacancy of just over 4 percent, with about 1.3 million square feet of deliveries year-to-date and just 230,000 square feet in the pipeline, on an inventory of 111.8 million square feet, Avison Young reported.
In September, Trammell Crow Co. secured equity financing from Standard Real Estate Investments for its 217,000-square-foot, 17-acre Woodridge Industrial Center in Woodridge, Ill.
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