Partnership Grabs 121,000-SF Industrial Building

"Their plan is to buy industrial real estate within five minutes of an interchange along Interstate 55 from downtown out to Harlem Avenue," says Edward Wabick, principal of Paine/Wetzel ONCOR International, who represented ASB and UIRC in the deal. "I've worked with them and sold them other properties, and that's their whole plan."

The seller was 2180 S. Racine LLC, a family that Wabick says purchased the 167,000-square-foot site more than a decade ago as a location for its company. The decision to sell the property came following consolidations within the company, Wabick says.

2180 S. Racine LLC was represented by Rodger Chenore, EVP; Albert Schulman, SVP; and Jeffrey Girling, senior associate, also with Paine/Wetzel ONCOR International.

"Buildings in this area are difficult to find in the right price and under the right situation," Wabick tells GlobeSt.com, about the Pilsen industrial corridor in which 2180 S. Racine is located. "There's never a ton of properties available in this market, and ASB was willing to buy this building based on what it offered."

UIRC has been purchasing properties under this same Interstate 55-centric acquisition strategy for the past 15 years, and ASB has been its funding source and partner in the vast majority of those acquisitions. UIRC owns about 1.8 million square feet along Interstate 55 within Chicago city limits.

"That area has higher occupancy and higher rent, and it's where we've developed our expertise in positioning properties for tenant demand," Bismarck Brackett, president of UIRC, tells GlobeSt.com. "Our properties are actually leasing better in this bad economy since companies want to be tenants and no longer want to own their own buildings because they want to preserve their capital."

Industrial properties in the city of Chicago have an overall occupancy around 93%, according to Transwestern's Q1 market report. Asking lease rates for industrial in that area range from $4 to $8 per square foot, according to recent Cushman & Wakefield research.

Brackett says the economy has presented a unique climate which UIRC hopes to take advantage of in the purchase of additional properties. "Right now, we're seeing really good opportunities and bargains to purchase at prices that are very low in comparison to what we've become accustomed to paying in the past," he says. "We're actively looking to acquire and engaged in the acquisition of additional properties. Everyone is hunkered down right now, which is what's creating these opportunities, but our challenge is the banks and getting the deals financed."