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.

It goes without saying that the current pandemic is going to change the landscape of the economy, but there is confidence in Chicago’s industrial real estate market moving forward.

Cawley Chicago’s industrial 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

Cawley Chicago Industrial Real Estate Lease Statistics Q2 2020

Top Overall Chicago Industrial Real Estate Lease Statistics

12 Month Deliveries (Square Feet): 21.4 million (22.2 million in Q1 2020)
12 Month Net Absorption (Square Feet): 14.5 million (13.8 million in Q1 2020)
Vacancy Rate: 6.3% (6.3% in Q1 2020)
12 Month Rent Growth: 3.6% (4.3% in Q1 2020)

Top Chicago Industrial Leases (Past 12 Months)

1) Property: 3300 Channahon Rd
Submarket:
Joliet Area
Leased SF:
1,220,140
Quarter:
Q3 2019
Tenant: Target
Tenant Rep: CBRE
Leasing Rep:
NAI Hiffman

2) Property: I-55 / Amoco Rd
Submarket: 
Joliet Area
Leased SF:
1,100,000
Quarter:
Q3 2019
Tenant:
Amazon

1) Property: 1023 E Laraway Rd
Submarket:
Joliet Area
Leased SF:
1,026,00
Quarter:
Q3 2020
Leasing Rep: JLL

4) Property: 3501 S Pulaski Rd
Submarket: South Chicago
Leased SF:
999,900
Quarter:
Q4 2019
Tenant:
Target
Tenant Rep: CBRE
Leasing Rep:
Cushman & Wakefield

5) Property: 3501 S Pulaski Rd
Submarket:
South Chicago
Leased SF:
999,900
Quarter:
Q4 2019
Tenant:
Target
Tenant Rep:
CBRE
Leasing Rep:
Cushman & Wakefield

Top Chicago Industrial Sales Statistics (Past 12 Months)

Sales Comparables: 1,481 (1,539 in Q1 2020)
Average Cap Rate:
8.8% (9.2% in Q1 2020)
Average Price/ SF: 
$72 ($74 in Q1 2020)
Average Vacancy at Sale: 9.7% (11.2% in Q1 2020)

Top Chicago Industrial Property Sales

1) 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

2) Property: 2400 Dralle Rd
*Rating: 5
Year Built: 2011
Building SF: 1,350,000
Vacancy: 
0%
Price (PSF): $73,150,000 ($54)
Cap Rate: Not Listed

3) Property: Building 1 (2357 S Wood St)
*Rating:
5
Year Built: 
2017
Building SF:
227,043
Vacancy: 
0%
Price (PSF): 
$68,683,000 ($303)
Cap Rate: 
Not Listed

4) Property: 325 S Route 31
*Rating:
3
Year Built: 
1956
Building SF:
4,000,000
Vacancy: 
0%
Price (PSF): 
$68,579,000 ($17)
Cap Rate: 
Not Listed

5) Property: 11211 Burlington Rd
*Rating: 5
Year Built: 2014
Building SF: 513,976
Vacancy: 
0%
Price (PSF): $56,800,000 ($111)
Cap Rate: Not Listed

*Rating is 1-5, 5 being the best

Chicago Industrial Construction Projects Statistics

Properties Currently Under Construction: 66 (71 in Q1 2020)
Total Size: 
18,036,120 (17,234,698 SF in Q1 2020) 
Percent of Inventory:
1.5% (1.4% in Q1 2020)
Preleased:53.7% (38.8% in Q1 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: Harbor Freight (3401 Brandon Rd)
Rating*:
5
Building SF:
1,639,000
Stories:
1
Completion:
Q4 2020
Developer/ Owner:
CenterPoint Properties

3) Property: Medline Industries (20444 W Peterson Rd)
Rating*:
5
Building SF:
1,400,000
Stories:
1
Completion:
Q1 2021
Developer/ Owner:
The Alter Group / Medline Industries

4) Property: I-55 / Amoco Rd
Rating*:
5
Building SF:
1,100,000
Stories:
1
Completion:
Q4 2020
Developer/ Owner:
Venture One Real Estate

5) Property: Exchange 55 (3501 S Pulaski Rd)
Rating*:
5
Building SF:
999,900
Stories:
1
Completion:
Q2 2020
Developer/ Owner:
Hilco Real Estate

*Rating is 1-5, 5 being the best

See the Top 10 Chicago Industrial Projects Currently Under Construction

Cawley Chicago I-88 West Industrial Real Estate Lease Statistics Q2 2020

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

12 Month Deliveries (Square Feet): 2.4 million (2.4 million in Q1 2020)
12 Month Net Absorption (Square Feet): 1.4 million (877K in Q1 2020)
Vacancy Rate: 7.3% (7.8% in Q1 2020)
12 Month Rent Growth: 3.7% (4.3% in Q1 2020)

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

1) Property: 2119 Fisher Dr 
Rating:
4
Deals:
1
Square Feet:
104,957
Vacancy:
60.0%
Net Absorption:
104,957

2) Property: 1998 Melissa Ln
Rating:
4
Deals:
2
Square Feet:
103,949
Vacancy:
67.6%
Net Absorption:
87,164

3) Property: Prarie Point I (2012 Corporate Ln)
Rating:
4
Deals:
2
Square Feet:
43,243
Vacancy:
4.6%
Net Absorption:
43,243

Cawley Chicago South I-55 Industrial Real Estate Lease Statistics Q2 2020

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

12 Month Deliveries (Square Feet): 1.4M (2.2M in Q1 2020)
12 Month Net Absorption (Square Feet): 996K (3.1M in Q1 2020)
Vacancy Rate: 8.3% (7.9% in Q1 2020)
12 Month Rent Growth: 3.3% (4.3% in Q1 2020)

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

1) Property: Airport Logistics Center 1 (20100 Renwick Rd)
Rating:
5
Deals:
1
Square Feet:
543,780
Vacancy:
0%
Net Absorption:
543,780

2) Property: Airport Distribution Center
Rating:
4
Deals:
1
Square Feet:
676,026
Vacancy:
54.5%
Net Absorption:
384,768

3) Property: Interchange 55 Logistics Park (901 W Bluff Rd)
Rating:
5
Deals:
1
Square Feet:
400,400
Vacancy:
64.9%
Net Absorption:
400,400

Cawley Chicago O'Hare Industrial Real Estate Lease Statistics Q2 2020

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

12 Month Deliveries (Square Feet): 1.2M (1.1M in Q1 2020)
12 Month Net Absorption (Square Feet): -2.1M (-1.4M in Q1 2020)
Vacancy Rate: 7.4% (7.0% in Q1 2020)
12 Month Rent Growth: 3.5% (4.4% in Q1 2020)

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

1) Property: Elk Grove Technology Park (150 Innovation Dr)
Rating:
4
Deals:
1
Square Feet:
43,206
Vacancy:
78.6%
Net Absorption:
43,207

2) Property: Prologis (350 N York Rd)
Rating:
4
Deals:
1
Square Feet:
41,186
Vacancy:
34.3%
Net Absorption:
30,661

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

Sales Comparables: 92 (100 in Q1 2020)
Average Cap Rate: 
10.4% (10.9% in Q1 2020)
Average Price/ SF: 
$42 ($74 in Q1 2020)
Average Vacancy at Sale: 4.8% (7.5% in Q1 2020)

Top I-88 West Industrial Real Estate Property Sales

1) Property: 325 S Route 31 (2380 Dielh Rd)
*Rating: 3
Year Built: 1956
Building SF: 4,000,000
Vacancy: 
0%
Price (PSF): $68,579,000 ($17)
Cap Rate: Not Listed

2) Property: White Oak Center (2380 Dielh Rd)
*Rating: 4
Year Built: 1996
Building SF: 304,482
Vacancy: 
0%
Price (PSF): $23,473,132 ($77)
Cap Rate: Not Listed

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

Sales Comparables: 81 (87 in Q1 2020)
Average Cap Rate: 
10.1% (10.1% in Q1 2020)
Average Price/ SF: 
$99 ($95 in Q1 2020)
Average Vacancy at Sale: 13.8% (12.8% in Q1 2020)

Top South I-55 Industrial Real Estate Property Sales

1) Property: Building 2 (600 Remington Blvd)
*Rating: 3
Year Built: 2016
Building SF: 320,703
Vacancy:
17.7%
Price (PSF): $35,776,428 ($112)
Cap Rate: Not Listed

2) Property: Park 355 I (2145 Internationale Pky)
*Rating:
5
Year Built: 
2008
Building SF:
256,182
Vacancy: 
0%
Price (PSF): $26,680,692 ($104)
Cap Rate: Not Listed

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

Sales Comparables: 167 (168 in Q1 2020)
Average Cap Rate: 
8.3% (8.5% in Q1 2020)
Average Price/ SF: 
$85 ($82 in Q1 2020)
Average Vacancy at Sale: 11.3% (12% in Q1 2020)

Top O’Hare Industrial Real Estate Property Sales

1) Property: 201 Mittel Dr
*Rating:
3
Year Built: 
1987
Building SF:
261,411
Vacancy: 
0%
Price (PSF): $29,400,000 ($112)
Cap Rate: Not Listed

2) Property: Elk Grove Tech Park (200 Innovation Dr)
*Rating: 4
Year Built: 2019
Building SF: 165,128
Vacancy:
0%
Price (PSF): $29,000,000 ($176)
Cap Rate: Not Listed

3) Property: 220 N York Rd
*Rating: 4
Year Built: 2019
Building SF: 190,226
Vacancy:
100%
Price (PSF): $24,920,000 ($131)
Cap Rate: Not Listed

 

I-88 West Industrial Construction Projects Statistics

All-Time Annual Average Square Feet: 1,364,832 (1,375,404 in Q1 2020)
Delivered SF (Past 4 Qs):
2,805,399 (2,936,439 in Q1 2020)
Delivered SF (Next 4 Qs):
1,680,000 (1,600,000 in Q1 2020)
Proposed SF (Next 4 Qs): 1,684,030 (777,030 in Q1 2020)

Top I-88 West Industrial Projects Delivered

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

2) 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: 2,788,540 (2,818,596 in Q1 2020)
Delivered SF (Past 4 Qs):
3,223,919 (3,362,154 in Q1 2020)
Delivered SF (Next 4 Qs):
1,119,619 (1,119,619 in Q1 2020)
Proposed SF (Next 4 Qs): 4,734,859 (4,723,859 in Q1 2020)

Top South I-55 Industrial Projects Delivered

1) Property: 1035 S Frontage Rd
Rating*:
4
Building SF:
153,042
Stories:
1
Completion:
Q1 2020
Developer/ Owner:
Sterling Bay

2) Property: 599 S Schmidt Rd
Rating*:
5
Building SF:
218,754
Stories:
1
Completion:
Q1 2020
Developer/ Owner:
Bridge Development Partners / McShane Development Co.

Top South I-55 Industrial Projects Under Construction

1) Property: Bldg 1 (775 Veterans Pkw) 
Rating*:
5
Building SF:
573,752
Stories:
1
Completion:
Q3 2020
Developer/ Owner:
Crow Holdings Industrial / Trammell Crow Residential

2) Property: Bldg 2 (825 Veterans Pky)
Rating*:
5
Building SF:
256,375
Stories:
1
Completion:
Q2 2020
Developer/ Owner:
Crow Holdings Industrial / High Street Realty Company, LLC

O’Hare Industrial Construction Projects Statistics

All-Time Annual Average Square Feet: 646,104 (636,272 in Q1 2020)
Delivered SF (Past 4 Qs):
2,255,561 (1,860,694 in Q1 2020)
Delivered SF (Next 4 Qs):
1,113,151 (1,565,739 in Q1 2020)
Proposed SF (Next 4 Qs): 791,215 (711,130 in Q1 2020)

Top O’Hare Industrial Projects Delivered

1) Property: O’Hare Logistics Center III (2100 S Wolf Rd)
Rating*:
3
Building SF:
72,000
Stories:
1
Completion:
Q3 2020
Developer/ Owner:
Seefried Industrial Properties / Raco Industrial Properties

2) Property: NWC of Devon & Tonner
Rating*:
3
Building SF:
146,029
Stories:
1
Completion:
Q2 2020
Developer/ Owner:
CA Ventures, LLC

Top O’Hare Industrial Projects Under Construction

1) Property: Bldg 1 (1150 W Devon Ave) 
Rating*:
4
Building SF:
248,625
Stories:
1
Completion:
Q2 2020
Developer/ Owner:
Bridge Development Partners / Banner Oak Capital Partners, LP

2) Property: Bldg 2 (1050 W Devon Ave)
Rating*:
4
Building SF:
247,176
Stories:
1
Completion:
Q2 2020
Developer/ Owner:
Bridge Development Partners / Banner Oak Capital Partners, LP

Data Sources: Cawley Chicago & CoStar 

 

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