CHICAGO—The Chicago region's industrial market has been expanding at a remarkable rate for several years now, with vacancy rates continuing to decline or hold steady even as developers create millions of square feet of new inventory. And some firms are beginning to look ahead and prepare for the day when users need to expand into new areas or submarkets.
Molto Properties, an Oakbrook Terrace, IL-based developer, had a flurry of activity in the last month. One of its moves was to purchase 79 acres of vacant land located along McLindon Rd. in Minooka, IL. Three or four other developers have also acquired land nearby, and Mike Powers, senior principal and chief investment officer at Molto, tells GlobeSt.com that the area should be an attractive location for logistics firms, especially larger regional or national distributors.
“There has definitely been a lot of new supply entering the market in the past couple of years,” he says. But “supply and demand seem to be closely matched up,” and conditions should remain relatively healthy in 2017 and 2018.
“But we're not just looking 12 or 18 months out,” he adds, “we're thinking long term.” And the Minooka land purchase is part of that strategy. There is a growing demand for larger distribution buildings along the I-80 Corridor, and the location should hold up in good times and bad. Site improvements will begin in the spring to prepare for the development of an industrial building with up to 1.3 million square feet.
But even though Molto has been building a lot of speculative developments recently, it wants to hold this land for a build-to-suit. Developers have already created a number of speculative buildings around I-80, and users looking for space have a number of options, he says. “We can be patient; we don't have to build on this land right away.”
But he also believes that prospective tenants, especially those that need a big box, will start knocking on Molto's door relatively soon. “Not every requirement can be done in a spec, and if anyone needs more than one million square feet, or maybe 800,000 square feet with an option to expand further, they're going to have to look at a build-to-suit option.”
Powers says beginning site improvements out in Minooka will give Molto a head start on the competition. And among the developers now out in the area, “none can accommodate anything as large as we can.”
Jim Estus with Colliers International represented Molto in this transaction. Lynn Reich with Colliers represented the seller.
CHICAGO—The Chicago region's industrial market has been expanding at a remarkable rate for several years now, with vacancy rates continuing to decline or hold steady even as developers create millions of square feet of new inventory. And some firms are beginning to look ahead and prepare for the day when users need to expand into new areas or submarkets.
Molto Properties, an Oakbrook Terrace, IL-based developer, had a flurry of activity in the last month. One of its moves was to purchase 79 acres of vacant land located along McLindon Rd. in Minooka, IL. Three or four other developers have also acquired land nearby, and Mike Powers, senior principal and chief investment officer at Molto, tells GlobeSt.com that the area should be an attractive location for logistics firms, especially larger regional or national distributors.
“There has definitely been a lot of new supply entering the market in the past couple of years,” he says. But “supply and demand seem to be closely matched up,” and conditions should remain relatively healthy in 2017 and 2018.
“But we're not just looking 12 or 18 months out,” he adds, “we're thinking long term.” And the Minooka land purchase is part of that strategy. There is a growing demand for larger distribution buildings along the I-80 Corridor, and the location should hold up in good times and bad. Site improvements will begin in the spring to prepare for the development of an industrial building with up to 1.3 million square feet.
But even though Molto has been building a lot of speculative developments recently, it wants to hold this land for a build-to-suit. Developers have already created a number of speculative buildings around I-80, and users looking for space have a number of options, he says. “We can be patient; we don't have to build on this land right away.”
But he also believes that prospective tenants, especially those that need a big box, will start knocking on Molto's door relatively soon. “Not every requirement can be done in a spec, and if anyone needs more than one million square feet, or maybe 800,000 square feet with an option to expand further, they're going to have to look at a build-to-suit option.”
Powers says beginning site improvements out in Minooka will give Molto a head start on the competition. And among the developers now out in the area, “none can accommodate anything as large as we can.”
Jim Estus with Colliers International represented Molto in this transaction. Lynn Reich with Colliers represented the seller.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
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.
