CHICAGO—Many of the speculative industrial buildings recently developed in the metropolitan area are on a modest scale, usually around 200,000-square-feet, but in late 2013 the Opus Group and USAA Real Estate Co. felt confident enough to launch the ambitious I-88 Gateway Logistics Center in North Aurora, a bet that now seems to have paid off. Opus finished the 604,565-square-foot bulk warehouse last October and the partners have already secured a tenant. Midwest Warehouse & Distribution System, Inc. has signed a long-term lease agreement for the entire space and will move in over the next few months.
“We're extremely pleased to have secured this long-term lease, and look forward to working with Midwest Warehouse to customize this large bulk space to meet their business needs,” says Mike Yungerman, vice president of real estate development for the Minneapolis-based Opus Development Co., LLC. “We've seen a significant decrease in industrial vacancies in the region and are proud to help fill that void with this project and others in the Midwest.”
The fourth quarter was certainly a good time to bring such a huge project to the market. The vacancy rate for the I-88/Fox Valley submarket sank to just 6.83%, a drop of 43 bps from the previous year, according to Colliers International. The vacancy rate had not dropped below 7.0% since 2000. And including this project, developers completed about 1.2-million-square-feet of new industrial product in 2014, nearly triple the amount in 2013.
As reported in GlobeSt.com, the Opus Group has also launched the development of two speculative industrial buildings in suburban Romeoville, one with 133,800-square-feet and the other with 121,200-square-feet.
The new I-88 Gateway logistics center sits on 32 acres of land and features 32' clear height, 60 docks, 103 trailer parking spaces, ESFR sprinkler system and T5 lighting.
“With the tremendous amount of activity occurring in the I-88 corridor we feel the timing of this transaction could not have been better,” says David Reahl, managing director of investments for USAA. “We are excited about the success of the project and look forward to welcoming Midwest Warehouse as a new tenant into our portfolio.”
Based out of Woodridge, IL, Midwest Warehouse provides third-party logistics including warehouse and distribution services for companies across the Midwest. Opus Design Build, LLC plans to customize the facility for the company's distribution needs, including installing a guard house and additional docks.
Opus owns an additional 25 acres of land within the park that it can use for building expansion or future build-to-suit opportunities of up to 450,000-square-feet.
Opus Development Co., LLC was the developer, Opus Design Build, LLC was the design-builder, Opus AE Group, LLC was the architect and engineer of record and USAA Real Estate Co. owns the building. Tim Thompson of HSA Commercial Real Estate represented Midwest Warehouse in the lease transaction and Brandon Kelly and Todd Heine of Avison Young were the listing brokers.
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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.
