Chicago Industrial Real Estate Report: Leases, Sales & Construction Projects

Chicago Industrial Real Estate Market Report 2019

Chicago is considered one of the top commercial real estate markets in the United States. Unemployment in The Windy City dropped almost 1% over the first quarter of 2019 alone to 4%. That is the best it has been since the crisis in 2009, where it rose above 13%. The manufacturing sector in Chicago gained over 8,000 jobs from 2018 to 2019. Job growth is one of the best indications for the health of a commercial real estate market, especially for industrial real estate.

After reaching record levels of unemployment, Chicago’s unemployment rate jumped to 16.3% in June 2020, and dropped to 11.7% in September according to the latest figures from the U.S. Bureau of Labor Statistics. Currently unemployment levels are at 7.7% as of March 2021.

It goes without saying that the current pandemic has changed and will continue to affect the landscape of the economy, but there is confidence in Chicago’s industrial real estate market moving forward. It also should be stated that things are starting to look up in many ways as the vaccines are being rolled out to the masses as well.

Cawley Chicago’s industrial real estate experts pull the top stats for leases, sales, and projects under construction in Chicago’s industrial real estate market every quarter in order to get a clear idea of where the market is and where it is going. Cawley also covers the I-88 West, South I-55, and O’Hare industrial real estate markets comparatively.

Demand for industrial product in the city has remained consistent since the initial quarantine.

We are seeing continued strong interest from investors looking to plant their flag or expand their infill and last-mile footprints. With the shifts property values and increase in industrial local business’ production, we are very busy.

We are seeing high demand from both tenants and purchasers alike.

Frank Melchert, Principal / Industrial Specialist @ Cawley Chicago

Chicago Industrial Real Estate Leases Q1 2021 - Commercial Real Estate Statistics - Cawley Chicago

Top Overall Chicago Industrial Real Estate Lease Statistics

12 Month Deliveries (Square Feet): 21 million (22.1 million in Q4 2020)
12 Month Net Absorption (Square Feet): 19.9 million (16.1 million in Q4 2020)
Vacancy Rate: 6.2% (6.2%% in Q4 2020)
12 Month Rent Growth: 4.2% (3.2% in Q4 2020)

Top Chicago Industrial Leases (Past 12 Months)

1) Property: 3401 Brandon Rd
Submarket:
Joliet Area
Leased SF:
1,645,462
Quarter:
Q4 2020
Tenant: Harbor Freight
Tenant Rep: Cresa
Leasing Rep:
NAI Hiffman

2) Property: 2400 Dralle Rd
Submarket:
Far South Cook
Leased SF:
1,350,000
Quarter:
Q4 2020
Tenant: Clorox Company Distribution
Tenant Rep: Not Listed
Leasing Rep:
Not Listed

3) Property: 24231 S Exchange Blvd
Submarket: 
Joliet Area
Leased SF:
1,290,460
Quarter:
Q4 2020
Tenant:
Scotts Miracle-Gro
Tenant Rep: CBRE
Leasing Rep: Colliers International

4) Property: 3501 Brandon Rd
Submarket: Joliet Area
Leased SF:
1,128,258
Quarter:
Q1 2021
Tenant:
Not Listed
Tenant Rep: Not Listed 
Leasing Rep:
NAI Hiffman

5) Property: 1023 E Laraway Rd
Submarket:
Joliet Area
Leased SF:
1,026,000
Quarter:
Q3 2020
Tenant:
General Motors
Tenant Rep:
Not Listed 
Leasing Rep:
JLL

Chicago Industrial Real Estate Sales Q1 2021 - Commercial Real Estate Statistics - Cawley Chicago

Top Chicago Industrial Sales Statistics (Past 12 Months)

Sales Comparables: 1,129 (1,166 in Q4 2020)
Average Cap Rate:
8.3% (8.6% in Q4 2020)
Average Price/ SF: 
$78 ($68 in Q4 2020)
Average Vacancy at Sale: 9.8% (9.3% in Q4 2020)

Top Chicago Industrial Property Sales

1) Property: 29900 S Graaskamp 
*Rating: 5
Year Built: 2015
Building SF: 2,028,954
Vacancy: 
0%
Price (PSF): $126,500,000 ($62)
Cap Rate: Not Listed

2) Property: Amazon Fulfillment Center (3501 120th Pl)
*Rating:
5
Year Built: 
2015
Building SF:
1,015,740
Vacancy:
0%
Price (PSF): 
$119,200,000 ($117)
Cap Rate: 
Not Listed

3) Property: 930 W Evergreen Ave
*Rating:
4
Year Built: 
1998
Building SF:
339,000
Vacancy: 
0%
Price (PSF): 
$100,000,000 ($295)
Cap Rate: 
5.3%

4) Property: Rock Creek Logistics Center (3300 Channahon Rd)
*Rating: 5
Year Built: 2018
Building SF: 1,220,140
Vacancy: 
0%
Price (PSF): $87,500,000 ($72)
Cap Rate: 4.5%

5) Property: Amazon (10500 S Woodlawn Ave)
*Rating: 4
Year Built: 2020
Building SF: 144,207
Vacancy: 
0%
Price (PSF): $65,074,000 ($451)
Cap Rate: Not Listed

*Rating is 1-5, 5 being the best

Chicago Industrial Real Estate Construction Projects Q1 2021 - Commercial Real Estate Statistics - Cawley Chicago

Chicago Industrial Construction Projects Statistics

Properties Currently Under Construction: 60 (60 in Q4 2020)
Total Size: 
20,409,346 (21,590,895 SF in Q4 2020) 
Percent of Inventory:
1.7% (1.8% in Q4 2020)
Preleased: 62.9% (57.9% in Q4 2020)

Top Chicago Industrial Projects Under Construction

1) Property: Ferrara Candy (Gurler Rd)
Rating*:
5
Building SF:
1,600,000
Stories:
1
Completion:
Q2 2021
Developer/ Owner:
Trammell Crow Company / Ferrara Candy Company

2) Property: Building B BTS (24101 S Bradley Rd)
Rating*:
4
Building SF:
1,360,520
Stories:
1
Completion:
Q4 2020
Developer/ Owner:
Venture One Real Estate / USAA Real Estate

3) Property: Wayfair (1040 W Renick Rd)
Rating*:
5
Building SF:
1,200,420
Stories:
1
Completion:
Q1 2022
Developer/ Owner:
Not Listed / Duke Realty Corporation

4) Property: Amazon (23257 S Central Ave)
Rating*:
5
Building SF:
1,015,000
Stories:
1
Completion:
Q1 2021
Developer/ Owner:
Venture One Real Estate

5) Property: Exchange 55 (3501 S Pulaski Rd)
Rating*:
5
Building SF:
999,900
Stories:
1
Completion:
Q2 2021
Developer/ Owner:
Hilco Real Estate / Hilco Redevelopment Partners

*Rating is 1-5, 5 being the best

 

Chicago Industrial Real Estate Construction Projects Q1 2021 - I-88 Real Estate Statistics - Cawley Chicago

Top I-88 West Corridor Industrial Lease Statistics (Past 12 Months)

12 Month Deliveries (Square Feet): 179,000 (1.6 million in Q4 2020)
12 Month Net Absorption (Square Feet): 2.1 million (2.9 million in Q4 2020)
Vacancy Rate: 5.0% (5.4% in Q4 2020)
12 Month Rent Growth: 4.1% (1.3% in Q4 2020)

4 & 5 Star Industrial Properties Leasing Activity in I-88 West Corridor (Past 12 Months)

1) Property: Mitchell Corporate Center (945 Corporate Dr) 
Rating:
4
Deals:
1
Square Feet: 
209,565
Vacancy:
54.2%
Net Absorption:
209,565

2) Property: 801 Bilter Rd 
Rating:
4
Deals:
1
Square Feet:
203,092
Vacancy:
60%
Net Absorption:
203,092

3) Property: 898 Meridian Lake Dr
Rating:
4
Deals:
1
Square Feet:
184,851
Vacancy:
60.0%
Net Absorption:
184,851

 

Chicago Industrial Real Estate Leases Q1 2021 - I-55 Real Estate Statistics - Cawley Chicago

Top South I-55 Corridor Industrial Lease Statistics (Past 12 Months)

12 Month Deliveries (Square Feet): 2M (2.2M in Q4 2020)
12 Month Net Absorption (Square Feet): 738,000 (1.7M in Q4 2020)
Vacancy Rate: 9.1% (8.7% in Q4 2020)
12 Month Rent Growth: 4.8% (3.1% in Q4 2020)

4 & 5 Star Industrial Properties Leasing Activity in South I-55 Corridor (Past 12 Months)

1) Property: Romeoville Commerce Center (208 S Pinnacle Dr)
Rating:
4
Deals:
1
Square Feet:
138,235
Vacancy:
41.5%
Net Absorption:
138,235

2) Property: 1533 Davey Rd 
Rating:
4
Deals:
1
Square Feet:
1114,591
Vacancy:
60.0%
Net Absorption:
114,591

3) Property: Bldg 4 (840 Windham Pky)
Rating:
4
Deals:
1
Square Feet:
93,184
Vacancy:
0%
Net Absorption:
93,184

 

Chicago Industrial Real Estate Construction Projects Q1 2021 - O'Hare Real Estate Statistics - Cawley Chicago

Top O’Hare Industrial Lease Statistics (Past 12 Months)

12 Month Deliveries (Square Feet): 2.5M (2M in Q4 2020)
12 Month Net Absorption (Square Feet): 1.9M (-405,000 in Q4 2020)
Vacancy Rate: 6.6% (7.2% in Q4 2020)
12 Month Rent Growth: 4.1% (4.2% in Q4 2020)

4 & 5 Star Industrial Properties Leasing Activity in South O’Hare (Past 12 Months)

1) Property: Building 3 (1015 W Devon Ave)
Rating:
4
Deals:
1
Square Feet:
245,624
Vacancy:
50%
Net Absorption:
245,624

2) Property: Building 2 (700 N Wood Dale Rd)
Rating:
4
Deals:
1
Square Feet:
241,888
Vacancy:
2.8%
Net Absorption:
241,888

2) Property: 220 N York Rd 
Rating:
4
Deals:
2
Square Feet:
190,226
Vacancy:
72.2%
Net Absorption:
132,088

 

Top I-88 West Industrial Sales Statistics (Past 12 Months)

Sales Comparables: 61 (62 in Q4 2020)
Average Cap Rate: 
7.2% (8.1% in Q4 2020)
Average Price/ SF: 
$79 ($38 in Q4 2020)
Average Vacancy at Sale: 14.9% (0.9% in Q4 2020)

Top I-88 West Industrial Real Estate Property Sales

1) Property: Butterfield Logistics Center (1103 Butterfield Rd)
*Rating: 5
Year Built: 2004
Building SF: 174,300
Vacancy: 
0%
Price (PSF): $12,400,000 ($71)
Cap Rate: Not Listed

2) Property: Excel Container Inc. (4390 S Route 59)
*Rating: 4
Year Built: 2005
Building SF: 128,036
Vacancy: 
0%
Price (PSF): $8,750,000 ($68)
Cap Rate: Not Listed

 

Top South I-55 Industrial Sales Statistics (Past 12 Months)

Sales Comparables: 36 (46 in Q4 2020)
Average Cap Rate: 
6.6% (Not Listed in Q4 2020)
Average Price/ SF: 
$73 ($72 in Q4 2020)
Average Vacancy at Sale: 28.5% (18.5% in Q4 2020)

Top South I-55 Industrial Real Estate Property Sales

1) Property: Prologis Romeoville (901 W Bluff Rd)
*Rating: 5
Year Built: 2019
Building SF: 684,320
Vacancy:
41.5%
Price (PSF): $50,272,343 ($73)
Cap Rate: Not Listed

1) Property: Prologis Romeoville (1001 W Bluff Rd)
*Rating: 5
Year Built: 2019
Building SF: 657,540
Vacancy:
100%
Price (PSF): $47,728,267 ($73)
Cap Rate: Not Listed

 

Top O’Hare Industrial Sales Statistics (Past 12 Months)

Sales Comparables: 113 (125 in Q4 2020)
Average Cap Rate: 
7.6% (8.0% in Q4 2020)
Average Price/ SF: 
$95 ($79 in Q4 2020)
Average Vacancy at Sale: 8.1% (11.8% in Q4 2020)

Top O’Hare Industrial Real Estate Property Sales

1) Property: 1925 Busse Rd
*Rating: 5
Year Built: 2013
Building SF: 208,406
Vacancy:
0%
Price (PSF): $36,600,000 ($176)
Cap Rate: Not Listed

2) Property: Building VII (1800 – 1872 Brummel Ave) 
*Rating:
3
Year Built: 
1978
Building SF:
531,456
Vacancy: 
2.7%
Price (PSF): $39,168,117 ($74)
Cap Rate: Not Listed

3) Property: Wood Dale DC (640 N Central Ave)
*Rating: 4
Year Built: 2020
Building SF: 159,170
Vacancy:
100%
Price (PSF): $23,550,000 ($148)
Cap Rate: Not Listed

 

I-88 West Industrial Construction Projects Statistics

All-Time Annual Average Square Feet: 1,260,080 (1,271,844 in Q4 2020)
Delivered SF (Past 8 Qs):
2,640,966 (2,813,620 in Q4 2020)
Delivered SF (Next 8 Qs):
2,567,000 (1,660,000 in Q4 2020)
Proposed SF (Next 8 Qs): 1,690,760 (1,741,141 in Q4 2020)

Top I-88 West Industrial Projects Delivered

1) Property: BTS (Heartland Dr)
Rating*:
5
Building SF:
70,000
Stories:
1
Completion:
Q4 2020
Developer/ Owner:
Triumph Construction Services / Entre Commercial Realty LLC

2) Property: Prologis Aurora (701 Bilter Rd)
Rating*:
3
Building SF:
161,986
Stories:
1
Completion:
Q2 2020
Developer/ Owner:
Prologis, Inc.

3) Property: Diageo (25820 W 143rd St)
Rating*:
3
Building SF:
1,500,000
Stories:
1
Completion:
Q1 2020
Developer/ Owner:
Seefried Properties, Inc.

Top I-88 West Industrial Projects Under Construction

1) Property: Ferrara Candy (Gurler Rd)
Rating*:
5
Building SF:
1,600,000
Stories:
1
Completion:
Q2 2021
Developer/ Owner:
Trammell Crow Company / Ferrara Candy Company

 

South I-55 Industrial Construction Projects Statistics

All-Time Annual Average Square Feet: 2,739,796 (2,763,840 in Q3 2020)
Delivered SF (Past 8 Qs):
4,266,452 (4,236,042 in Q4 2020)
Delivered SF (Next 8 Qs):
1,825,277 (624,857 in Q4 2020)
Proposed SF (Next 8 Qs): 4,203,667 (3,476,671 in Q4 2020)

Top South I-55 Industrial Projects Delivered

1) Property: Pinnacle 24 (W Taylor Rd & Southcreek)
Rating*:
4
Building SF:
646,380
Stories:
1
Completion:
Q4 2020
Developer/ Owner:
Pizzuti Companies

2) Property: 599 S Schmidt Rd
Rating*:
5
Building SF:
218,754
Stories:
1
Completion:
Q4 2020
Developer/ Owner:
Bridge Development Partners / McShane Development Co.

Top South I-55 Industrial Projects Under Construction

1) Property: Wayfair (1040 W Renick Rd)
Rating*:
5
Building SF:
1,200,420
Stories:
1
Completion:
Q1 2022
Developer/ Owner:
Duke Realty Corporation

2) Property: Carlow XVII (Rodeo Dr) 
Rating*:
4
Building SF:
402,051
Stories:
1
Completion:
Q2 2021
Developer/ Owner:
Northern Builders, Inc

3) Property: Carlow XVII (Rodeo Dr) 
Rating*:
4
Building SF:
222,806
Stories:
1
Completion:
Q2 2021
Developer/ Owner:
Northern Builders, Inc

 

O’Hare Industrial Construction Projects Statistics

All-Time Annual Average Square Feet: 48,172 (677,224 in Q4 2020)
Delivered SF (Past 8 Qs):
165,128 (165,128 in Q4 2020)
Delivered SF (Next 8 Qs):
0 (0 in Q4 2020)
Proposed SF (Next 8 Qs): 0 (0 in Q4 2020)

Top O’Hare Industrial Projects Delivered

1) Property: Nippon Express Headquarters (800 N IL Route 83)
Rating*:
4
Building SF:
317,513
Stories:
1
Completion:
Q2 2021
Developer/ Owner:
Alston Construction Co / Nippon Express

2) Property: 255 Pierce Rd
Rating*:
4
Building SF:
230,000
Stories:
1
Completion:
Q1 2021
Developer/ Owner:
RagingWire Data Centers

3) Property: 222 E Devon Ave
Rating*:
4
Building SF:
83,052
Stories:
1
Completion:
Q1 2021
Developer/ Owner:
Seefried Properties, Inc

Top O’Hare Industrial Projects Under Construction

1) Property: Phase III (1000 – 1138 N Tower Ln) 
Rating*:
4
Building SF:
144,350
Stories:
1
Completion:
Q3 2021
Developer/ Owner:
Hamilton Partners

Data Sources: Cawley Chicago & CoStar 

 

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