CHICAGO—PCCP, LLC has just formed a joint venture with Panattoni Development Co. Inc. and acquired a 51-acre land parcel in suburban Lockport. The partners plan to develop Lockport 355, a four-building industrial park totaling 846,510 square feet.
PCCP/Panattoni plan to develop the Lockport project in two phases and end up with four class A warehouse and distribution buildings. The developers will begin construction on two of the buildings, one of 274,040 square feet and another of 228,690 square feet, in June and expect to complete this phase during the first quarter of 2016.
Jim Galovan, managing director with PCCP, tells GlobeSt.com that the partners want to concentrate on mid-sized buildings because "there is much less competition and strong demand. We believe there are better chances for rent growth."
“This is the first equity investment PCCP has executed with Panattoni and we are looking forward to being a partner with one of the nation's most reputable and successful industrial developers,” he adds. “This project is well located on the expanded I-355 Veteran's Memorial Tollway in a high demand submarket of Chicago.”
The vacancy rate among industrial properties in the I-55 Corridor submarket has been hovering around 10% as demand keeps pace with the new space hitting the market, according to a recent report from Colliers International. The new PCCP/Panattoni development will join a long list of local projects either recently finished or underway. Developers delivered a total of 746,900 square feet during the first quarter, 40% of all completed projects in Chicagoland and the most of any submarket.
No developments were started in the first quarter, but Colliers says that developers have six speculative and two build-to-suit projects underway that will eventually add 1.5 million square feet to the corridor's inventory. Duke Realty Corp. has broken ground on the largest, a 324,100 square-foot speculative warehouse/distribution facility at 1341 Enterprise Dr. in Romeoville.
Tenants leased about 1.3 million square feet of space in the first quarter, Colliers found, more than triple the space leased in the fourth quarter. This was due to PAE's new 723,300 square-foot lease of a bulk distribution facility at 1070 Windham Parkway in Romeoville, the largest lease transaction in the Chicago region during the first quarter.
As reported in Globest.com, Molto Properties recently unveiled plans for an 116,000 square-foot speculative industrial property at 1055 Remington Blvd. in suburban Bolingbrook, and has already gotten a lease signed for half of the space.
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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.
