McShane/Rego Plan $80M Medical Office Park

HOFFMAN ESTATES, IL-A joint venture between McShane Corp., based in Rosemont, and the Rego Group Ltd., based in Inverness, plans to develop a 23-acre parcel recently acquired in the Prairie Stone Business Park. The land parcel, at the northwest corner of Interstate 90 and Route 59, was acquired for an undisclosed price from Sears Holding Corp., which is headquartered in the 780-acre business park. The joint venture plans a mixed-use development with medical office, retail and a hotel, says Stephen Doyle, vice president of McShane Corp. The cost of the development is between $80 million and $90 million, Doyle tells GlobeSt.com.

The development will be constructed in two phases with work on the first phase beginning at the end of the month. The first phase will include site work, a medical office building and some retail which is expected to open in the third quarter of next year, Doyle says. The Prairie Pointe Medical Office Center will be a four-story building with 66,000 sf. The joint venture decided to construct a medical office building as opposed to “a typical office building where workers come in the day and that is it,” Doyle says. “Whereas, a medical building, physicians could see four to eight patients per day.” The medical office draws “a lot of traffic” to the development and supports the retail, he says. In addition, medical office tenants tend to be longstanding tenants who provide some stability to the rent rolls, a spokeswoman says.

There will be between 70,000 sf and 80,000 sf of retail in the first phase with a mixture of both inline space and a “medium-size box retailer,” he says. Construction on the second phase of the development is expected to begin next spring and open in the first or second quarter of 2009. The second phase will include three restaurants of about 8,000 sf to 12,000 sf each and a hotel, Doyle says. The hotel will probably be between 70,000 sf and 90,000 sf with between 130 and 160 rooms, he tells GlobeSt.com.