CHICAGO—Brennan Investment Group, LLC has just successfully leased up a new speculative warehouse building in the O'Hare submarket that it finished late last year. The quick lease-up is another illustration that the Chicago region, with its falling vacancy rate, robust new construction and escalating rents, continues to be one of the top industrial markets in the US.
The Rosemont, IL-based firm signed a new lease with Cambria Co., a producer of natural quartz surfaces, for the last 40,460 square feet available at 1780 Birchwood Ave in suburban Des Plaines. As reported in GlobeSt.com, Pet Food Experts previously agreed to lease the other 98,785 square feet.
“If you are able to get a multitenant building leased up in under a year, it's indicative of a very healthy market,” Scott McKibben, co-founder and chief investment officer of Brennan, tells GlobeSt.com. The company showed this property to about a dozen prospective tenants during the lease-up period, and that level of activity has certainly kindled Brennan's interest in launching similar developments. “We are actively pursuing a couple of projects in the O'Hare area and in other submarkets around the Chicago region.”
At the end of the second quarter, the metro region's vacancy rate was 7.23%, down 36 bps from the first quarter level of 7.59%, according to Colliers International. “Vacancy has declined 120 bps from 8.43% reported one year ago,” its latest report notes. And the rate in the O'Hare submarket declined from 5.97% to 5.45% since the first quarter.
Brennan's newest building features 32' clear height, ample loading, trailer parking, and auto parking. It was designed to handle warehousing, assembly, and distribution uses, and was built to a LEED standard. The Colliers team of Jonathan Kohn and Thomas Rodeno represented Brennan in this transaction, and the Cushman & Wakefield team of Britt Casey and Al Caruana represented the Le Sueur, MN-based Cambria. Keeley Construction was Brennan's general contractor.
Although McKibben could not give any financial details from the new lease, he did say that Keeley would be doing quite a bit of work on Cambria's space to get it ready for use. “It's going to be both a showroom and a warehouse.”
He adds that Brennan officials are still not sure if they will sell the new building or hold onto it for the long-term. “We're just happy to be done with it and now we're looking for the next opportunity.”
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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.
