CHICAGO- A partnership between HSA Commercial Inc. and Industrial Income Trust announced yesterday that they will break ground this month on an 180,480-square-foot speculative warehouse in west suburban Woodridge.
“There hasn't been a speculative building in this suburb in four or five years,” says Craig Phillips, executive vice president of development with Chicago-based HSA Commercial. The resulting pent-up demand, along with what the partners consider a reviving economy and the advantages to a site freely visible from Interstate 355 “all came together and resulted in us green lighting the project.”
DCT Industrial Trust recently completed a 604,100-square-foot warehouse and distribution center in nearby Romeoville. It was the first speculative warehouse built in the I-55 Corridor submarket since 2008, but Phillips does not worry about losing prospective tenants.
“We won't be competing with a building of that size,” he says. HSA and IIT will most likely divide their new warehouse into sections of nearly 20,000-square-feet and accommodate a group of smaller tenants. “Most of the activity we see in that submarket comes from a lot of growing companies,” Phillips explains, “and they haven't been able to do anything for years and need to grow into a larger space.”
The new structure will be Phase 2 of Park 355, a 37-acre complex near the junction of I-355 and I-55 that HSA helped begin developing in 2006. Phase 1 was a 254,453-square-foot distribution center that the firm leased to logistics and manufacturing tenants such as Ace Hardware, Tricor Braun and DIK Drugs. In June 2011, Denver-based IIT purchased the fully-occupied building from HSA and Bridge Development Partners.
“That's how we originally got to know them,” Phillips adds. “We feel optimistic that not only do we have the right partner, but the right strategy. We've looked at some of the other buildings that will come on line in this market and there's nothing of this size.”
Researchers say the submarket has excellent prospects. “Despite an enormous amount of space flooding the market, the I-55 Corridor's 2012 net absorption measured positive 2.4 million square feet,” according to Colliers' year-end report. “The strong positive year-end outcome was the result of tremendous user demand.”
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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.
