Morgan Stanley was represented by Kenneth Szady, executive director, and James Carpenter, senior director, of Cushman & Wakefield of Illinois Inc.'s Capital Markets Group in the investment sale.
"This was probably the best portfolio of industrial real estate offered in Chicago in five years because it was all new, less than ten years old, and it was substantially leased," Carpenter tells GlobeSt.com. Half of the tenancy was investment grade or outstanding credit, and it's in probably the best submarket of all of Chicago. It was as good a portfolio as I've seen in years, and evidence of that is that interest level was very high from name brand institutional buyers."
Buildings in the portfolio include 250, 268-78 and 310 Windy Point Dr. in Glendale Heights, all of which are 63,500 square feet. The portfolio also included the 75,200-square-foot 179-195 Internationale Blvd., also in Glendale Heights, and the 126,000-square-foot 847-953 Church Ct. in Elmhurst. "It's methodical selling on Morgan Stanley's part," Szady tells GlobeSt.com. "They typically sell properties in any market, and these properties are of such high quality they realized the liquidity would be there."
The properties are in the north DuPage submarket, an area Szady says is outperforming many others in terms of occupancy rates, which are around 91%, according to Grubb & Ellis' mid-year industrial market report. Average asking lease rates in the submarket are near $5.50 per square foot, Grubb's research shows. Szady says a lack of available land has increased demand for existing assets.
"You hear a lot of negative news today, but what this demonstrated is that if somebody presents to the market great locations that are leased with good tenants in high-quality property, there is no shortage of institutional buyers today. It's very selective, but a buyer like TA has ample funds to purchase this high-quality asset. These types of properties don't avail themselves as often as we'd like, but this is a prime example of great real estate being brought to market and bought on an all cash basis."
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