The 251,940-sf building's 91% occupancy is about par for the Schaumburg area market. Rents in the building are about $12 per sf net, in a market where comparable rents are $14 per sf net, says President and Chief Operating Office Patrick R. Hunt. Great Lakes was able to acquire the property from Chicago-based Jupiter Realty Corp. at an 11% capitalization rate, as well as $103 per sf, about two-thirds of the building's replacement cost, Hunt says.

Tenants include the Prairie Comm cellular telephone company, Shared Medical Systems, Verizon Wireless, Skytel, American Express, HQ Office Suites and Countrywide Funding, says chief investment officer Ray Braun.

"1600 Corporate Center property is a high quality building in a good location, and we expect the property will enhance our offerings in the northwest suburban market provide our company a favorable yield on our investment," says Great Lakes Chairman and CEO Richard May.

The REIT's latest acquisition is a building with granite panels and ribbon-glass windows on six acres at the northeast corner of Golf and New Wilke Roads, about two miles east of an interchange with Route 53/Interstate 290. The $700,000 will be used for roof repair, on the heating, ventilation and air conditioning system and the parking lot, Braun says.

It also is the Great Lakes' fourth Schaumburg submarket property, and second acquisition here in less than a year. Great Lakes bought the 109,647-sf Woodfield Green Executive Center in Schaumburg for $9.7 million in August.

Great Lakes already owned two buildings at 1750 and 1900 E. Golf Road in Schaumburg, just west of the interstate. The two buildings total 477,901 sf.

Paul Lundstedt, executive director of the Chicago office of Cushman & Wakefield, represented Jupiter Realty.

Great Lakes officials indicated in their last conference call they were negotiating the purchase of a Chicago area property as well as two in the suburban Denver market, expected to cost $30 million. The Rolling Meadows purchase closed March 1, company officials say.

Acquisitions in 2001 may hit $100 million, May says, as the REIT sees opportunities to make value-added purchases.

Also, the REIT has increased its quarterly dividend 11.1% to $.40 per share payable April 3 to shareholders of record as of March 16. "Based upon our current payout policies, we expect that any future earnings growth will require us to raise our dividends proportionately," says chief financial officer James Hicks.

Great Lakes REIT owns and manages 5.4 million sf of suburban office properties in Chicago, Detroit, Denver, Minneapolis, Milwaukee, Cincinnati and Columbus, OH.

Instant Insights /

Great Lakes Finds Value-Added Opportunity in $26-Mil Suburban Office Tower Buy

Related Stories

Recommended For You