AURORA, IL-There is movement in the 500,000-square-foot and up industrial category, but the market is still precarious to allow tenants to rule the deals. For example, Midwest Warehouse, a third-party logistics firm, recently signed a deal to take all of a Duke Realty Corp.-owned warehouse here – for a one-year lease.
The tenant was already leasing more than half of the building at 2805 Duke Pkwy., and has at times occupied parts of the rest of the facility by paying an additional fee, says Brad Borkowski with HSA Commercial Real Estate. He and Tim Thompson represented Midwest in the deal. Midwest started leasing 350,000 square feet at the building when it opened in 2008. “They wanted to lease the whole building, but stay flexible,” Borkowski tells GlobeSt.com
Midwest also occupies Illinois buildings in Bedford Park, Bensenville, Naperville, Northlake, Plainfield and Woodridge. Borkowski says a lack of new development and several pending deals in the suburban Chicago market will improve absorption. The Chicago industrial market saw positive absorption by 1.5 million square feet in the second quarter, the first positive numbers in 18 months.
“We’re seeing an increase in activity, and everybody is hopeful that it will continue. Rents seem to have bottomed out,” Borkowski says. Asking rents are at $3.93 per square foot for warehouse space, according to a Grubb & Ellis second quarter report.
Lynn Reich and Brian Kling with Colliers B&K represented the owner in the lease. The building is on a 25-acre site in Duke’s Butterfield East industrial park, which sits on 233 acres northwest of the Interstate 88 and Route 59 interchange. US Foodservice recently bought 50 acres at the park for about $8.2 million.
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