Former Dominick's Outlots Selling Well

CHICAGO—The recent shuttering of the once-popular Dominick's Finer Foods stores could have been a worrisome development for the metro area's retail market. But since then demand for the vacated spaces has remained strong. Millennium Properties R/E, for example, had no shortage of prospective buyers when it recently brokered the sale of five former Dominick's outlots located throughout the suburbs. The spaces were sold as a portfolio to GMX Real Estate Group, a regional retail developer based in suburban Vernon Hills, for a total of $3.4 million.

Three of these properties – located in Fox Lake, Oswego and Shorewood – were developed as gas stations with small convenience stores. The stations were decommissioned and the sites are ready for redevelopment. Two other outlots, in Aurora and Frankfort, are both zoned for retail or future gas station development.

All of the sites are located in their respective area's main retail districts close to both residential and commercial areas with strong demographic trends, Susan B. Silver, executive vice president of Millennium, tells GlobeSt.com. And several are adjacent to grocery stores that have been acquired by Mariano's, now the region's hottest grocer. “All of these sites are where the action is. Every one of the Dominick's was well-located.”

“We had 20 offers for the Oswego site,” she adds, the most of any site. But each received multiple offers, which began coming in almost immediately, with several prospective buyers bidding for all five as a portfolio. Most were local developers, along with a few out-of-towners. “The locals win every time because they know the market better.” She expects GMX to redevelop all five sites as free standing retail properties.

Millennium Properties currently manages about 2.5-million-square-feet of space throughout Chicagoland area, including industrial, office, retail and multi-family properties. And it is currently working on the sale and leasing of several former Dominick's properties. Silver sees this most recent portfolio sale as a good indicator of the state of the region's retail market. “I think things are picking up; if it's priced right everything is selling.”