Middle Market Digest-The Midwest

BY THE NUMBERS

CHICAGO-The vacancy rate at self-storage facilities in Chicago will tumble 130 bps 12.1% this year, the strongest dip in the Midwest region, according to a new mid-year outlook published by Marcus & Millichap. The decline reverses the prior two years' increases and pushes the vacancy rate to a seven-year low. The average asking rent for non-climate-controlled units will rise 2.1% this year, while climate-controlled facilities will generate a 1.6% gain, reaching $1.22 per square foot and $1.62 per square foot, respectively. Last year, non-climate-controlled rent increased 1.4%, and rent at climate-controlled units remained flat.

NEWS & NOTABLES

CHICAGO-David Gaines has just joined the Chicago office of Holliday Fenoglio Fowler, LP as a director focused on multi-housing investment sales in the Chicago area and throughout the Midwest. He has more than 16 years of multi-housing commercial real estate experience and joins HFF from Berkadia Real Estate Advisors, where he was a managing director. Prior to that, he was with Marcus & Millichap Real Estate Investment Services, where he rose from their sales intern program to senior director of their national multi-housing group and co-head of the mid-market multifamily practice when he left in 2015. “We have seen increasing interest from our clients for middle market investment opportunities and are excited to have a dedicated specialist such as David at HFF to meet our client's growing needs in this space,” says Jeff Bramson, head of HFF's Chicago office. 

MINNEAPOLIS-Ryan Cos. US, Inc. has promoted Mike Ryan to senior vice president – north region market leader and executive in charge of its Minneapolis-based North Region. “Mike has distinguished himself as a solid business leader and strategic thinker in growing our Ryan A+E group over the last seven years,” says Jeff Smith, national president of Ryan Cos. Ryan has served, and will continue to serve, as the president of Ryan A+E and leader of the company's national architecture and engineering practice. His most recent project experience includes leading the design of the largest LEED Platinum for the Wells Fargo Downtown East corporate office project in Minneapolis, serving as project executive for CHS Field; playing a key role in the Aurélien residential tower in Chicago. He has also worked with Ryan Cos. customers such as Cargill, Target Corp., Whole Foods, University of Saint Thomas, and Wells Fargo.

DEALTRACKER

CAROL STREAM, IL-Brown Commercial Group recently brokered the sale of a 31,300 square foot industrial building at 262 Carlton Dr. in Carol Stream, IL. Financial terms were not disclosed. Elk Grove Village, IL-based Brown's vice president of sales, Mike Antonelli represented the seller, CCS Realty, LLC, which is consolidating its business and relocating outside of IL. Dan Brown, president of Brown, represented the buyer, a private investor who plans to make extensive renovations to the building to enhance its value. “Investors continue to search for high quality industrial space in the Chicago suburban market and are increasingly turning to buildings that offer good long-term potential, even those properties requiring extensive renovations,” says Antonelli. “This is another sign of the strength and resilience of Chicago's industrial market.”

MATTOON, IL-Triad Real Estate Partners recently completed the sale of a 288-bed student housing property at Lake Land College in Mattoon, IL. The property consists of six buildings in two phases built between 1997 and 2008. It is located directly adjacent to the north end of the campus at Lake Land College. The property was 100% leased for the 2016-17 academic year and is already 100% pre-leased for next year. The sellers are local developers who own a portfolio of student housing assets in the region. The Pittsburgh-based buyers are a private ownership group that have just entered the student space and plan to focus on higher-yield opportunities at smaller schools.  Lake Land Living traded for $7,875,000 which equates to $27,344 per bed and an 8.0% cap rate.

BUILDING BLOCKS

MILWAUKEE-The Opus Group has just completed a new 60,000-square-foot corporate headquarters for Delta Defense LLC in West Bend, WI. The two-story building was built to accommodate Delta Defense's growing operations and employee base, while also allowing for seamless expansion in the future. Opus worked closely with Kahler Slater throughout the design process and incorporated input and feedback from Delta's employees to ensure the end-result had all the elements that Delta Defense needed for their business to thrive and a proper foundation for future growth, says Matt Bratzke, director, project management, Opus Design Build, LLC. “This project was a great fit for our design-build approach as it allowed for creativity and flexibility throughout the process and as the design evolved.” The building was completed in February and Delta was fully operational in the space in early March.

CHICAGO-Murphy Development Group and CIM Group have broken ground on 1326 S. Michigan Ave., a new 47-story residential tower that will bring 500 apartments to the Near South Side. In addition to representatives from both companies, Alderman Pat Dowell, the project's architect, SCB, and the project's contractor, Walsh Construction participated in the ceremonial casting of the project's first shovelful of soil. The tower, flanked by two lower structures, will provide a mix of studios, one-, two-, and three-bedroom units, and approximately 7,500 square feet of ground floor retail, as well as parking for 188 vehicles. 1326 South Michigan is scheduled to be completed in early 2019.

BY THE NUMBERS

CHICAGO-The vacancy rate at self-storage facilities in Chicago will tumble 130 bps 12.1% this year, the strongest dip in the Midwest region, according to a new mid-year outlook published by Marcus & Millichap. The decline reverses the prior two years' increases and pushes the vacancy rate to a seven-year low. The average asking rent for non-climate-controlled units will rise 2.1% this year, while climate-controlled facilities will generate a 1.6% gain, reaching $1.22 per square foot and $1.62 per square foot, respectively. Last year, non-climate-controlled rent increased 1.4%, and rent at climate-controlled units remained flat.

NEWS & NOTABLES

CHICAGO-David Gaines has just joined the Chicago office of Holliday Fenoglio Fowler, LP as a director focused on multi-housing investment sales in the Chicago area and throughout the Midwest. He has more than 16 years of multi-housing commercial real estate experience and joins HFF from Berkadia Real Estate Advisors, where he was a managing director. Prior to that, he was with Marcus & Millichap Real Estate Investment Services, where he rose from their sales intern program to senior director of their national multi-housing group and co-head of the mid-market multifamily practice when he left in 2015. “We have seen increasing interest from our clients for middle market investment opportunities and are excited to have a dedicated specialist such as David at HFF to meet our client's growing needs in this space,” says Jeff Bramson, head of HFF's Chicago office. 

MINNEAPOLIS-Ryan Cos. US, Inc. has promoted Mike Ryan to senior vice president – north region market leader and executive in charge of its Minneapolis-based North Region. “Mike has distinguished himself as a solid business leader and strategic thinker in growing our Ryan A+E group over the last seven years,” says Jeff Smith, national president of Ryan Cos. Ryan has served, and will continue to serve, as the president of Ryan A+E and leader of the company's national architecture and engineering practice. His most recent project experience includes leading the design of the largest LEED Platinum for the Wells Fargo Downtown East corporate office project in Minneapolis, serving as project executive for CHS Field; playing a key role in the Aurélien residential tower in Chicago. He has also worked with Ryan Cos. customers such as Cargill, Target Corp., Whole Foods, University of Saint Thomas, and Wells Fargo.

DEALTRACKER

CAROL STREAM, IL-Brown Commercial Group recently brokered the sale of a 31,300 square foot industrial building at 262 Carlton Dr. in Carol Stream, IL. Financial terms were not disclosed. Elk Grove Village, IL-based Brown's vice president of sales, Mike Antonelli represented the seller, CCS Realty, LLC, which is consolidating its business and relocating outside of IL. Dan Brown, president of Brown, represented the buyer, a private investor who plans to make extensive renovations to the building to enhance its value. “Investors continue to search for high quality industrial space in the Chicago suburban market and are increasingly turning to buildings that offer good long-term potential, even those properties requiring extensive renovations,” says Antonelli. “This is another sign of the strength and resilience of Chicago's industrial market.”

MATTOON, IL-Triad Real Estate Partners recently completed the sale of a 288-bed student housing property at Lake Land College in Mattoon, IL. The property consists of six buildings in two phases built between 1997 and 2008. It is located directly adjacent to the north end of the campus at Lake Land College. The property was 100% leased for the 2016-17 academic year and is already 100% pre-leased for next year. The sellers are local developers who own a portfolio of student housing assets in the region. The Pittsburgh-based buyers are a private ownership group that have just entered the student space and plan to focus on higher-yield opportunities at smaller schools.  Lake Land Living traded for $7,875,000 which equates to $27,344 per bed and an 8.0% cap rate.

BUILDING BLOCKS

MILWAUKEE-The Opus Group has just completed a new 60,000-square-foot corporate headquarters for Delta Defense LLC in West Bend, WI. The two-story building was built to accommodate Delta Defense's growing operations and employee base, while also allowing for seamless expansion in the future. Opus worked closely with Kahler Slater throughout the design process and incorporated input and feedback from Delta's employees to ensure the end-result had all the elements that Delta Defense needed for their business to thrive and a proper foundation for future growth, says Matt Bratzke, director, project management, Opus Design Build, LLC. “This project was a great fit for our design-build approach as it allowed for creativity and flexibility throughout the process and as the design evolved.” The building was completed in February and Delta was fully operational in the space in early March.

CHICAGO-Murphy Development Group and CIM Group have broken ground on 1326 S. Michigan Ave., a new 47-story residential tower that will bring 500 apartments to the Near South Side. In addition to representatives from both companies, Alderman Pat Dowell, the project's architect, SCB, and the project's contractor, Walsh Construction participated in the ceremonial casting of the project's first shovelful of soil. The tower, flanked by two lower structures, will provide a mix of studios, one-, two-, and three-bedroom units, and approximately 7,500 square feet of ground floor retail, as well as parking for 188 vehicles. 1326 South Michigan is scheduled to be completed in early 2019.