CHICAGO—The industrial market in the Chicago area has continued to recover from the economic turmoil touched off by the financial crisis. And Value Industrial Partners, a Chicago-area property owner, has just refinanced a large group of their holdings, locking in low, long-term rates while structuring the new loan to give them flexibility to sell the properties as the market continues to improve.
“They have no specific plans to sell assets,” says Jeff Cherner, senior vice president and managing director of NorthMarq's Chicago regional office. His firm arranged the first mortgage refinancing of $31.65 million for 23 VIP properties. “But if the economy and the market continue to improve, as conditions warrant, the structure of this financing optimizes their ability to sell.”
Financing was based on 5- and 7-year terms and a 25-year amortization schedule.
The 23 properties have over 90 tenants and a total of about 900,000-square-feet. This group of properties is just a portion of VIP's total portfolio. The company holds over 70 buildings that range from 4,000-square-feet to 161,501-square-feet spread out across the suburbs. Most of the tenants are local companies involved in light-manufacturing, assembly or repair.
The viability of these properties “pretty much mirrors the local economy,” Cherner says. “As the economy continues to improve, then the companies that occupy these types of buildings should grow,” making the buildings more attractive to investors and users.
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
