CHICAGO—In affluent suburban towns like Naperville and Schaumburg the best retail locations are leased up for premium rates, and that has definitely perked up interest among investors. Retail Properties of America, Inc. recently became the latest buyer to close a major retail purchase in Naperville by acquiring Main Street Promenade, a mixed-use development of 182,000 square feet in the heart of its downtown, for a gross purchase price of $88 million.
The project includes about 103,000 square feet of retail space and 79,000 square feet of office. Tenants currently occupy 93.1% of the space, including Anthropologie, J Crew, Soft Surroundings, Ann Taylor, LOFT, Sur la Table, White House Black Market and Hugo's Frog Bar & Fish House.
“We continue to be very active in our pursuit of high quality assets within our target markets,” says Matthew Beverly, senior vice president, director of investments. And as Naperville boasts an average household income of $130,000, making it one of the most affluent and well-educated zip codes in the country, Main Street Promenade was a good fit for the Oak Brook, IL-based firm.
Other investors have found that similar Naperville properties can generate solid returns. As reported in GlobeSt.com, Oak Brook, IL-based Inland Private Capital Corp. recently completed the sale of Freedom Commons in Naperville. Although the sale price was not released, company officials did say that coupled with cash flow generated during the holding period, the sale resulted in a total return to the investors of 149%. The property was bought in 2013 for $24.4 million. In addition, the sale resulted in a 15.59% average annual return.
And RPAI's new acquisition, first developed by Dwight and Ruth Yackley of BBM Inc., also provides an opportunity for new development. It includes a vacant parcel that the city approved for future development of up to 62,000 square feet of mixed-use space, Beverly adds. This “will provide us the opportunity to leverage our robust, local operating platform and knowledge to densify the property.”
CHICAGO—In affluent suburban towns like Naperville and Schaumburg the best retail locations are leased up for premium rates, and that has definitely perked up interest among investors. Retail Properties of America, Inc. recently became the latest buyer to close a major retail purchase in Naperville by acquiring Main Street Promenade, a mixed-use development of 182,000 square feet in the heart of its downtown, for a gross purchase price of $88 million.
The project includes about 103,000 square feet of retail space and 79,000 square feet of office. Tenants currently occupy 93.1% of the space, including Anthropologie, J Crew, Soft Surroundings,
“We continue to be very active in our pursuit of high quality assets within our target markets,” says Matthew Beverly, senior vice president, director of investments. And as Naperville boasts an average household income of $130,000, making it one of the most affluent and well-educated zip codes in the country, Main Street Promenade was a good fit for the Oak Brook, IL-based firm.
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
