CB&K finds a golden egg and other big-box leases Rosemont, Ill.-based Colliers Bennett & Kahnweiler (CB&K) Inc. has added one more feather to the Goose Island Industrial Campus hat, but other parts of Chicagoland report a bounty of 100,000 sq. ft.-plus leases as well. CB&K and Smithfield Properties LLC will redevelop a 338,000 sq. ft. flex project at 1132 W. Blackhawk St. for-based divine interVentures.
The $60 million redevelopment includes 144,000 sq. ft. of rehabbed former crane space; a two-story, 99,000 sq. ft. facility; a five-story, 95,000 sq. ft. building and a 500-car parking garage. Internet company divine interVentures has signed a 20-year lease for the property - known as Habitat Goose Island - to house the company's portfolio of affiliates.
In the Chicago suburbs, the local office of New York-based Cushman & Wakefield has brokered a number of leases. Cushman & Wakefield represented Indianapolis-based Duke-Weeks Realty Corp. in the negotiation of a 12-year, 230,400 sq. ft. distribution center lease in Bolingbrook, Ill. Locally based tenant Hub Logistics was represented by Northbrook, Ill.-based Grubb & Ellis in the $7.5 million transaction. The 460,800 sq. ft. building is now 50% leased.
Also in Bolingbrook, Cushman & Wakefield represented Chatsworth, Calif.-based Sanyo Logistics in the sale-leaseback of a 293,989 sq. ft. building to Boston-based Cabot Industrial Properties LP. Asking price was $11.2 million. Sanyo signed a $2.65 million, five-year lease for its regional distribution center. Represented by the local office of New York-based Insignia ESG, Boulder, Colo.-based Schwinn leased the remaining 140,000 sq. ft.
Again in Bolingbrook, Cushman & Wakefield represented Schaumburg, Ill.-based Remington Associates and Turnberry Office LP in the sale of a four-building, 187,801 sq. ft. portfolio in Remington Lake Business Park to Cabot Industrial Trust. Asking price was $11.5 million.
In Joliet, Ill., Cushman & Wakefield represented Franklin Park, Ill.-based Unimast Inc. in a long-term lease transaction with Atlanta-based Industrial Developments International (IDI). Unimast leased a 150,000 sq. ft. build-to-suit in Rock Run Business Park. The building is expandable by 75,000 sq. ft.
Finally, Cushman & Wakefield represented Rolling Meadows, Ill.-based Preferred Meal Systems Inc. in the purchase of a 105,000 sq. ft. distribution center in Berkeley, Ill. The building was purchased from Glenview, Ill.-based North American Paper Co., which was represented by CB&K.
Bristol finds that SoCalkeep getting bigger San Francisco-based Bristol Group Inc. has acquired a 3.8 million sq. ft. Southern California industrial portfolio for $190 million. Bristol acquired the portfolio from Boston-based AEW Capital Management LP.
Developments included in the transaction are Bell-Garfield Business Center, University Commerce Center and La Mirada Commerce Center. The properties - located in the Central Los Angeles, South Bay and Mid Counties submarkets - were developed in the 1970s and 1980s.
The transaction gave Bristol the opportunity to acquire developments in in-fill transportation linked locations at below replacement cost, according to Jeffrey Kott, principal of Bristol Group.
Binswanger makes it happen in Tulsa and N.C. Philadelphia-based Binswanger has arranged a long-term lease for 900,000 sq. ft. in Tulsa, Okla., as well as the sale of a 455,000 sq. ft. industrial building in Newton, N.C. Chicago-based Navistar International signed a 15-year lease at the New Century Industrial Center at Tulsa International Airport, a development owned by the city of Tulsa. Tulsa recently acquired the site - a former Air Force Assembly plant - from the Department of Defense.
Navistar will begin making school buses at the Tulsa facility in 2001. Total cost for the project is estimated at $45 million. Binswanger represented both parties in the transaction.
In Newton, N.C., Hickory, N.C.-based CommScope Inc. acquired a 455,000 sq. ft. industrial building from Chicago-based R.R. Donnelley & Sons Co. Terms of the transaction were not disclosed. CommScope plans to convert the development into a research, development and manufacturing facility.
Panattoni living large with leases from coast to coast Sacramento, Calif.-based Panattoni Development Co. LLC wastes no time when it comes to big-box leases. The company recently signed build-to-suit contracts or leased more than 1 million sq. ft. in four deals, two on the East Coast and two in Southern.
The company has inked a build-to-suit contract in California's Inland Empire for Pamona, Calif.-based Office Star Products for a 200,485 sq. ft. facility that is scheduled for completion in June. Office Star will occupy the single-story building, which is in Ontario, Calif. Los Angeles-based CB Richard Ellis negotiated the transaction. Panattoni also has built a 424,000 sq. ft. distribution facility in Camarillo, Calif., for locally-based Technicolor Videocassette Inc.
On the East Coast, Panattoni signed Palo Alto, Calif.-based Hewlett-Packard to a 640,000 sq. ft. lease for two buildings in Richmond, Va. In Durham, N.C., locally based Bergen Brunswig has leased a 155,000 sq. ft. flex facility from Panattoni.
Hewlett-Packard will use the Richmond buildings for ink jet and after-market paper distribution in a move that consolidates operations from three other facilities. The company expects to relocate in April. Bergen Brunswig is consolidating three facilities into the Durham development, which includes 17,000 sq. ft. of office space.
AMB completes $375M fund's second closing San Francisco-based AMB Property Corp. has closed the second portion of its AMB Institutional Alliance Fund I, a multi-investor fund including 12 pension funds, foundations and endowments that have co-invested with AMB. Fund I now has a $150 million total equity commitment from third- party investors. Combined with debt financing and AMB's equity investment, the fund's capitalization totals $375 million. This quarter, AMB plans a third and final closing of equity commitments for Fund I.
AMB expects Fund I to use no more than 50% leverage. As of the second closing, AMB has the largest interest in Fund I and will maintain a minimum 20% equity ownership.
AMB and its investment management subsidiary will receive acquisition fees and portfolio management fees on the capital invested by its institutional partners, and AMB may receive a promoted interest if certain return thresholds are met.
Boston: not just the end of the cul-de-sac Although it is sometimes considered the "end of the cul-de-sac" when it comes to industrial development, the Boston area's vibrant economy still manages to garner investors' attention. A group of suburban Boston industrial/flex properties have changed hands thanks to financing for a Revere, Mass., building arranged by the Boston office of Houston-based Holliday Fenoglio Fowler and Boston-based Meredith & Grew Inc.*ONCOR International's efforts to secure a purchaser for a seven-property portfolio.
Meredith & Grew represented an affiliate of The Davis Cos., Boston, in selling a 595,893 sq. ft. suburban Boston portfolio of flex properties for $35.1 million. Chicago-based LaSalle Investment Management and Sacramento, Calif.-based CALEAST acquired the seven building portfolio in a joint venture. The portfolio is comprised of 20 and 30 Commerce Way and 225 Wildwood Avenue in Woburn, Mass.; 29 and 35 Dunham Road and One Enterprise Road in Billerica, Mass.; and 35 Otis Street in Westborough, Mass.
Holliday Fenoglio Fowler provided a $21.125 million three-year, adjustable, interim bridge loan on behalf of 135 American Legion Realty Trust through Chicago-based Heller Financial. Built in 1982, the property consists of 575,955 sq. ft. of industrial space.
Mid-Atlantic absorbs 400k Maryland's industrial market absorbed more than 400,000 sq. ft. in the past few months of 1999, with a batch of leases arranged by Baltimore-based Colliers Pinkard and the Baltimore office of Los Angeles-based CB Richard Ellis. CB Richard Ellis brokered a 200,000 sq. ft. lease to The Terminal Corp., Timonium, Md.
CB Richard Ellis represented the landlord, 2010 Reservoir Rd. Investors LLC, and the local office of-based Trammell Crow Co. represented the tenant. The five-year lease is valued at $3.5 million.
Colliers Pinkard negotiated two leases and one lease renewal in the Baltimore area. DAP Products Inc., a wholly owned subsidiary of Cleveland-based RPM Corp., leased 168,554 sq. ft. at 8410 Kelso Drive in Baltimore, a development of Atlanta-based UPS Properties. DAP will use the building as a Mid-Atlantic distribution center. Colliers also negotiated St. Louis-based Madison Warehouse Corp.'s 101,250 sq. ft. lease at 4653 Hollins Ferry Road in Baltimore.
On the renewal front, Colliers Pinkard represented Ft. Worth, Texas-based Alcon Laboratories Inc. in renewing a lease for 110,290 sq. ft. at 6740 Business Parkway in Elkridge, Md. The building's owner, Boston-based Cabot Advisors Inc., represented itself in the transaction.
SubmitOrder.com: Remember this name As if e-commerce doesn't have you salivating already, Columbus, Ohio-based SubmitOrder.com is on the verge of gobbling up literally millions of square feet of industrial space all over the world, with the backing of some of Silicon Valley's highest flyers. Silver Lake Partners, a $2.3 billion buy-out firm that is associated with Menlo Park, Calif.-based venture capital giant Kleiner Perkins Caufield and Byers, along with Jim Barksdale's The Barksdale Group, also of Menlo Park, recently acquired about half of SubmitOrder for $75 million. Barksdale, former CEO of Netscape Communications and former COO of FDX Corp., will take a seat on SubmitOrder.com's board.
The move makes Silver Lake and The Barksdale Group big players in the e-fulfillment business and gives SubmitOrder.com the financial muscle for rapid expansion. Not even a year old, SubmitOrder.com was spun off from Digital Storage last summer.
As an outsourcer for fulfilling e-commerce orders and customer service, SubmitOrder.com operates four leased distribution centers in Columbus, Ohio, two of which are owned by Indianapolis-based Duke-Weeks Realty Corp.
"We're not a vertical, one market-category type of company," says J.T. Kreager, SubmitOrder.com's president. "We really address the needs of pure-play dot-coms, click-and-mortar retailers and branded manufacturers that want to sell their products over the Internet. The infrastructure that we provide allows them to do that in a real speed-to-market fashion that enables them to build their brand online and scale their sales volume up through all the surges that come throughout the year."
The Silver Lake team and Submit Order.com both spent most of 1999 looking at partners before agreeing to a deal at the end of the year.
Now, SubmitOrder.com is formulating its expansion strategy with intent to lease millions of square feet across North America, Europe and Asia, Kreager says. Generally, the company is looking for big-box leases of 500,000 sq. ft. or more.
"What we're embarking on here is building a service company faster than one's ever been built," says Kreager. "The financial backing that we have - the influx of capital that we have - is strategic in and of itself because it allows us to invest in technology, overall infrastructure and people faster than we might have been able to on our own. It also applies to the experience [Barksdale and Silver Lake] have in operations and information technology and networking and contact relationships that they have built.
"We really see this as a global opportunity because the Internet and e-commerce are global," Kreager continues. "We will need to have distribution centers and customer response centers around the world."
And with SubmitOrder.com's demands for flexible, highly automated distribution space, the company will probably need newer structures. Here, the infancy of the Internet is sure to bring about new challenges.
"Some of the main differences are going to be the speed at which [developers] move and the flexibility needs," says Kreager. "Everyone is going to have to be able to adapt and change at a rate that's just unpredictable at this point. It's a young business, and there's no clear track to follow.
"It's obvious to a lot of developers, but there are intense needs from an information technology standpoint - having fiber come into the park and more electricity for PCs and those kinds of things," he adds. "[These are] basic infrastructure components that are critical for a company like ours to operate."