S.B. Friedman & Co. notes that while office vacancy in the 14-million-sf O'Hare submarket is 23.6%, the retail and residential markets near Executive Office Plaza, between Touhy Avenue and Northwest Highway, remain strong. The Lakota Group presented a series of redevelopment scenarios, including one with a 30,000-sf building anchored by retailers such as Crate & Barrel or Trader Joe's.

However, Chicago-based S.B. Friedman & Co. cautions potential retail developers to consider the 82,000 sf of commercial space expected to be added in the nearby Uptown Park Ridge redevelopment project farther west, which also is adding more than 75 multifamily units. All 51 loft units in the project were sold in a single day, according to S.B. Friedman & Co.'s report.

The properties already have drawn interest. The American Farm Bureau building at 225 E. Touhy Ave. was sold last year for nearly $5 million--$65 per sf--to Park Ridge 2004 LLC, which got a $7.4-million mortgage from Parkway Bank & Trust Co., according to the Cook County Recorder of Deeds office. Park Ridge 2004 also acquired 1 S. Washington Ave. early this year for nearly $2.2 million, according to property records, getting a $3.4-million mortgage. A long-term owner, George S. May International Co., refinanced its 303 and 315 S. Northwest Highway buildings for $3 million this year. K&F Management, which paid more than $1.1 million for 111 S. Washington Ave. in 2003, mortgaged the property last year for more than $1.5 million, according to property records.