1005 Westgate Dr. in Addison, IL.

CHICAGO—Class B industrial property throughout the Chicago suburbs has become quite popular with prestigious investors. Goldman Sachs Asset Management Private Real Estate just became the latest group to test the waters here. In an off-market transaction, the New York-based firm acquired an approximately 830,000 square foot, ten-building industrial portfolio located primarily in the O'Hare, North Cook and North DuPage submarkets.

“This is the first industrial deal we've done in IL,” Joseph Sumberg, co-head of GSAM PRE, tells GlobeSt.com, and one of the chief draws was the likelihood of finding higher yields, especially for buildings near dense populations, diverse labor pools and major thoroughfares. “The cap rates for infill product has not changed to the degree it has in other markets.”

One key reason for the high yield associated with this portfolio is that “there is a significant number of tenants and a lot of moving pieces,” he says. The company can't be passive and just collect the rent. “You're essentially getting paid for the work.” GSAM PRE plans to proactively lease known near-term vacancies, as well as strategically invest capital to maintain the portfolio's quality.