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O'Hare Office Market Turning Around

CHICAGO—Crossroads has just gotten one of its buildings to 93% occupied, a good example of how class A vacancy rates are falling around O'Hare.

By Brian J. Rogal | brianjrogal | | Updated on April 26, 2016

 

chi-crossroads (2) 6400 Shafer in Rosemont, IL, is now 93% occupied, up from 67% in 2012.
CHICAGO—Things are looking up for the office submarket that surrounds O’Hare International Airport. Its overall vacancy rate remains elevated, but tenants have been filling up class A spaces. Crossroads Partners , for example, took a bit of a risk back in 2012 when it bought the seven-story, 179,000 square foot building at 6400 Shafer Crt. In Rosemont. Tenants occupied just 67% of the class A property then, but today, with a new 9,760 square foot long-term lease just signed by Westinghouse Air Brake Technologies , Crossroads officials say they have stabilized the property and boosted the occupancy rate to 93%. “When we purchased 6400 Shafer it was an added value play,” Michael Nortman , owner and president of Crossroads Partners, tells GlobeSt.com. “The asset is now stabilized and we will be looking at our exit strategy options including a sale and a refinance. The O’Hare market has steadily improved since the Great Recession. Both occupancy and rental rates have increased. As this trend continues the cost for tenants to relocate has increased and landlords can better predict renewals.  We are also seeing this trend across our entire portfolio.” “Since purchasing the building, Crossroads has completed over 75,000 square feet of leases, adds senior vice president Zach Fox, who heads Crossroads Partners’ brokerage department. ”This is a testament to the success of our full-service approach to real estate; we put our tenant’s needs first.” In 2015, Crossroads invested in the common areas and amenities at Shafer Court, including introducing Halsted Street Deli . In the next few months, the company will complete a state-of-the-art building conference room where tenants can host seminars, lunch meetings, and other events. “We are in constant communication with our tenants and listen to them,” says  Nortman. “We operate all our properties with a hospitality and concierge approach. That’s what differentiates us from others in the market.” The overall vacancy rate in the O’Hare submarket is at 19.8%, according to a new report from Transwestern . But the class A rate has shrunk to 13.3%. “The O’Hare market is doing well because of access to convenient local transportation, including highways as well as Blue Line access from the city in some areas,” the report states.  

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