Middle Market Digest-The Midwest

NEWS & NOTABLES

CHICAGO—Newmark Knight Frank has just been appointed as the exclusive leasing agent of 400 Skokie Blvd. in Northbrook, IL. Ameritus Real Estate Investment purchased it last December and plans an extensive redevelopment with sizable capital improvements. Built in 1984 and partially renovated in 2012, the eight-story, 220,175-square-foot, multi-tenant office building features a Wi-Fi café, fitness center, conference center, on-site storage as well as two terraces on the second floor. The property provides tenants with quick access to I-94 and a myriad of restaurants, hotels and retail stores. Ameritus will complete the capital improvements, which will feature upgrades to the building’s exterior, lobby, elevator cabs, corridors, restrooms, parking lot and landscaping, by this year’s fourth quarter. NKF senior managing directors John Clark and Rob Lundin will lead the brokerage team. Whitney Architects is providing the architectural design services for the redevelopment project.

DETROIT—Smoothie King, a smoothie company with more than 960 locations worldwide, has signed up a new franchise partner that will bring the brand to the state of MI in 2018. Christopher Klebba, president of Northern Diamond Management, and his team have signed an agreement to develop 50 locations throughout the state. The team has begun seeking real estate in and around Detroit and plans to open three area locations, possibly in underserved communities, by the end of 2018. Klebba comes most recently from franchise group Impact Fitness, which owns 22 Planet Fitness gyms in MI and IN. “We are committed to making an active lifestyle attainable for people in our community, and we see a real need for an offering like Smoothie King,” says Klebba. “We were attracted to the Smoothie King brand because its mission to inspire people to live healthy, active lifestyles is perfectly aligned with ours, and we fell in love with the brand and the people.”

CHICAGO—Matthew Brodsky has joined NorthMarq Capital as a vice president in its newly relocated and expanding Chicago office. At NorthMarq, Brodsky will cultivate debt and equity solutions for its clients’ entire capital stack. A Chicago native, prior to joining NorthMarq, Brodsky spent six years at Freddie Mac, sourcing over $5.2 billion in multifamily transactions. In 2016, Brodsky was promoted to senior producer in the Freddie Mac Dallas central office, where he oversaw annual originations in excess of $1.65 billion across the six seller/servicer accounts within the central region. Brodsky holds a BS in public financial management from Indiana University and an MBA in real estate finance and investment from DePaul University.

CHICAGO—Tucker Development just forged a a strategic partnership with Seritage Growth Properties for the redevelopment of two Sears properties in Chicago located at 1601 N. Harlem Ave. and 4730 W. Irving Park Rd. Though currently in the design phase, preliminary plans for both projects call for mixed-use developments with retail and residential components. The revitalized site is located at the intersection of North and Harlem avenues. Straddling the border of Chicago and Elmwood Park, it includes a former Sears store at 1601 N. Harlem Ave., in the city’s Galewood neighborhood, as well as a shuttered Sears Auto Center at 1630 N. Harlem Ave., in Elmwood Park. Separately, Tucker and Seritage plan to redevelop the Sears store located at the intersection of Milwaukee and Cicero avenues and Irving Park Rd. – an area known as Six Corners.

DEALTRACKER

ST. LOUIS—Berkadia recently completed the sale of The Orion Apartments and Whole Foods, a mixed-use property in St. Louis. Ken Aston, managing director and Andrea Kendrick, senior director, of Berkadia’s St. Louis office represented the seller, St. Louis-based Mills Properties, Inc. The buyer was Canada-based Brass Enterprises, Inc. and the deal closed on May 8. “The Orion sale has set the new pricing benchmark for all apartment sales in the Midwest region of the US,” says Aston. “The developer, Mills Properties, is widely regarded as one of the premiers in the Midwest. The great deal of interest, both nationally and internationally, that we received was a testament to this level of excellence,” says Kendrick.

TROY, MI—Greystone has provided a $36, 32 million HUD-insured permanent loan to refinance Gables of Troy, a 544-unit multifamily property in Troy, MI. The transaction was originated by Cary Belovicz and Steve Van Riper of Greystone Bel Real Estate Advisors, and John Marr of Greystone, on behalf of Kaftan Communities. The FHA financing, was provided as part of HUD’s green program, reduced MIP by 35 bps, resulting in significant interest savings. The 35-year fully amortizing loan term carries a low, fixed interest rate. “Greystone’s assistance in optimizing the performance of this asset has been incredibly valuable,” says Jeffrey Kaftan of Kaftan Communities. “Their knowledge of HUD and the benefits of their green finance program enabled us to take advantage of favorable terms for upgrades we were planning to do regardless, so we are thrilled with the overall outcome of the refinance.”

CHICAGO—HSA Commercial Real Estate, a Chicago-based full-service real estate firm, today announced it has completed the sale of a 218,500-square-foot industrial building in the Delany Commerce Center – a multi-phase, 22.7-acre development east of the Tri-State Tollway in Waukegan, Ill. The firm developed the distribution center in 2013 in partnership with Washington Capital Management Inc. and recently sold the building to a private investor. Eagle Foods, a manufacturer and distributor of household food and snack products, and Trifinity Partners, a third-party logistics firm that serves major retailers, occupy 100% of the warehouse building at 2431 Delany Rd. “The current competitive labor market is a key factor in decision-making for distribution and logistics companies, and Lake County’s proximity to skilled workers has helped drive new development and leasing activity in the area,” says Robert Smietana, vice chairman and chief executive officer of HSA Commercial Real Estate. Mike Caprile, Ryan Bain and Zach Graham of CBRE represented the sellers in the transaction.

DETROIT—Industrial Commercial Properties LLC, a Cleveland-based developer, acquired 182 acres of land in Wixom, MI, on the site of the Ford Wixom assembly plant.  The seller was Boston-based Trident Barrow. “This is a major milestone for the continued redevelopment of this site,” says Christopher Semarjian, the owner of ICP. “This market has experienced considerable growth and we are excited about the possibilities. Ford Motors shuttered the plant in May 2007. To date, significant development has occurred on the southern end of the site, including retailers such as Menards, Aldi, General RV, At Home Goods Inc. and Duluth Trading Co. “Given its size and incredible access and visibility to the highway, existing utility infrastructure, power capacity and exposure to rail, we believe makes this location uniquely positioned in the Greater Detroit market,” adds Chris Salata, chief operating officer of ICP.

BUILDING BLOCKS

BENSENVILLE, IL—Chicago-based Dayton Street Partners plans to develop a 116,000-square-foot speculative distribution center in Bensenville, IL, on behalf of Black Creek Group, LLC. The announcement follows the completion of Dayton Street’s recent two-parcel land assemblage in Bensenville, IL, of a 90,000 square foot industrial building on 3.44 acres at 1055 Sesame St. and a 3.48-acre vacant land site at 491 Podlin Dr. Following demolition of an old outdated facility on the 1055 Sesame St. property, Dayton Street will break ground on the redevelopment on the combined acreage. The new state-of-the-art building will feature 32’ clear height ceilings, 24 exterior dock doors and 137 parking spots. A premier location near O’Hare International Airport’s southern cargo entrance, Dayton Street expects to draw interest from a variety of users in the freight forwarding and service industries and/or users seeking modern infill properties for last-mile distribution.