Chicago Suburban Market News
March 29, 2023 — Industrial building sales continued at a steady pace in the first quarter of 2023, with investors capitalizing on the strong demand in the Chicago suburban market. According to this Daily Herald story,Brown Commercial Group negotiated two industrial building sales totaling 48,171 square feet, helping investors and buyers navigate a market that is still seeing more demand than supply.
Brown Commercial Group partner Mike Antonelli and broker Matt Hanson representing the sellers in both transactions. Partner Trinity Scurto represented the buyers.
Chicago Suburban Market Spotlight
The buildings are both in DuPage County, located at 330 W. Fay Ave. in Addison and 2211-2239 Curtiss St. in Downers Grove, IL.
Bilmar Investments LLC sold the 25,575-square-foot Downers Grove building after completing extensive renovations and a strategic leasing program over the past several years. This approach helped increase occupancy and better position the property for sale. The transactions show the continued demand by investors for well-located buildings with modern features and strong leasing fundamentals.
The 22,596-square-foot Addison building was sold to Absolute Electronics, which is expanding from a 7,200-square-foot space in Elk Grove Village. It is moving into half the building, while the other half is leased to Air Gas, a long-term tenant in the building. The seller was 330 Fay LLC.
Solid Rent Growth in Q1 2023
According to research from Cushman & Wakefield, average asking rental rates continued to increase in the Chicago suburban market. Most submarkets recording significant YOY rent growth, with the average rate increasing 6.2% YOY to $6.78 per square foot (psf). Other rates included:
- Western Cook County rental rates jumped the most, increasing by 38.8% YOY to $7.34 psf
- Northeast DuPage recorded the second largest uptick in asking rents, increasing by 25.5% YOY to $9.25 psf.
- O’Hare remained the submarket with the highest overall asking net rental rate at $9.69 psf, up 19.6% YOY.
The manufacturing sector’s rents recorded significant growth, up 23.2% YOY to $7.21 psf, while the warehouse/distribution sector recorded moderate rent growth of 1.5% YOY to $6.08 psf.
