Middle Market Digest-The Midwest

BY THE NUMBERS

CHICAGO—Fewer and fewer families across the US own a home due to soaring prices and a shortage of entry-level homes, according to the most recent study by RentCafe. In the decade between 2006 and 2016, the drop in the number of families with children who own their home has reached almost 3.6 million, while the same demographic living in rentals has increased by 1.9 million. RentCafe also finds that renting with children is on the rise in the 30 largest US metros, while ownership is declining. The Chicagoland metro ranks third nationally when it comes to the net change in homeowner families with children—a decrease of 157,000 households between 2006 and 2016. The area also gained 32,000 renter families with kids during the same period of time. One cause for this trend are the steeper increases in single-family home prices when compared to rents. For example, the price of single-family homes in Chicagoland increased by 49% in the last five years, while rent prices rose by 23%.

DETROIT—The Detroit industrial market continued to expand in the second quarter of 2018, recording 881,618 square feet of positive absorption, keeping the vacancy rate to historic lows at 1.96%, according to CBRE’s Industrial MarketView. This activity dropped the overall availability rate slightly from 3.82% to 3.78%, marking the second straight quarter it has been below 4%. Users have responded by beginning built-to-suit projects. At the end of the second quarter, developers had 26 “build to suit” projects under construction, which will deliver 5.5 million square feet to the market. This is the largest amount of construction underway since 2002. “Demand has definitely ramped up construction in the Detroit market, but, with vacancy so low, even the current pipeline won’t be enough to meet user needs,” says Lauren Scarpace, CBRE’s senior vice president of advisory and transaction services.

NEWS & NOTABLES

CHICAGO—Howard Blair, who describes himself as a “construction guy in a suit,” has just joined Sterling Bay as a director of construction. He leaves Development Resources Inc. after a 32-year career in which he helped bring to life the projects and vision of some of the city’s most recognizable corporate names. “Howard is a legend in the business,” says Andy Gloor, Sterling Bay’s managing principal. “His business savvy and knowledge of the sometimes complicated construction business here in Chicago is a welcome addition to our team.” Blair will oversee development and re-development projects in Sterling Bay’s growing real estate portfolio, coordinating all aspects of the construction process while working closely with general contractors, architects, engineers and government officials to deliver projects on time and on budget. He joined DRI in 1985 and was involved with many of the largest and most significant rehab projects in recent history including: 224 S. Michigan Ave., the Wieboldt’s building, Robert Morris College, 120 S. LaSalle St. and 110 N. Wacker Dr.

DEALTRACKER

KANSAS CITY—This metro area has become increasingly important to the call center industry. TrialCard, a technology-enabled pharmaceutical solutions company, just became the latest firm to announce plans to open a new contact center in the city. “We are pleased to be expanding into Kansas City, a vibrant community made up of thousands of small businesses, tech start-ups, and top-notch health care,” says Mark Bouck, president and chief executive officer of TrialCard.  “A diverse, highly-educated workforce, an affordable cost of living and numerous cultural amenities make Kansas City a very desirable place to live and work.” TrialCard will bring 225 jobs to a 23,000-square foot operation in the Kansas City Business Center at 2001 NE 46^th St.

BUILDING BLOCKS

ST. LOUIS—Just six months after debuting its new, three-story, 102,000-square-foot expansion featuring 90 upscale apartment homes, the renamed McKnight Place Assisted Living & Memory Care has just celebrated the completion of the second phase of its $32 million investment project. The original McKnight Place building now has 74,000-square-feet of completely renovated space. It features 18 additional assisted living suites and introduces dedicated memory care in 27 separate memory care suites, accessible via a different entrance, for residents with cognitive impairments, such as Alzheimer’s disease and other forms of dementia. The homes are located on the 15-acre continuum of care campus at The Gatesworth in University City. The two-phase expansion increased the footprint of The Gatesworth campus to over one-million square-feet of space. It “represents the completion of many months of planning, hard work and dedication as we proudly expand our industry-leading senior care offerings with our new dedicated Memory Care community, where our devoted staff and memory care specialists are equipped to serve seniors of every level of cognitive ability,” says Charles Deutsch, co-owner of The Gatesworth.