CHICAGO—The demand for the Chicago area's newer industrial properties has increased so much that investors have begun assuming more risk by snapping up vacant buildings. EnTrust Realty Advisors, LLC, an affiliate of The Alter Group, for example, just sold 1660 Wall Street, a recently built 108,732-square-foot warehouse and distribution building in suburban Mt. Prospect, to KTR Capital Partners, a New York-based real estate private equity fund manager that specializes in industrial property. The warehouse was finished in 2009 but remained vacant.

“The property was developed at the bottom of the recession,” says James I. Clark III, the managing principal of EnTrust. But the demand for core industrial properties began to pick up as the area's economy started to revive. “It now makes sense for investors to buy even if they have to assume a leasing risk. We've seen that demand picking up in the last six months.”

1660 Wall Street was built as part of The Alter Group's Lake Center Corporate Park and sits near the intersection of Algonquin Rd. and Elmhurst Rd. just minutes from O'Hare International Airport. It was designed to appeal to major corporations and third-party logistics providers and features 30' clear ceilings, 19 exterior truck docks, two drive-in doors, and 16 trailer parking stalls. Clark says the location and modern amenities eased whatever fears the new owners had about finding tenants. The O'Hare submarket has “a lot of older product that does not have the same ceiling heights and access.”