PROPERTY ADDRESS | CITY, STATE

Title | Subtitle

PRESENTED BY:
9450 W. Bryn Mawr Avenue | Suite 550
Rosemont | IL | 60018
www.lee-associates.com

KENNETH P. FRANZESE
Direct: 773.355.3005
kfranzese@lee-associates.com

JOHN T. CASSIDY
Direct: 773.355.3006
jcassidy@lee-associates.com

CONFIDENTIAL OFFERING MEMORANDUM

CHAPTER 1
A. Section 1
B. Section 2
C. Section 3
D. Section 4

II. CHAPTER 2

A. Section 1

B. Section 2
III.

MARKET OVERVIEW
A. Metro Chicago Market Overview
B. North Kane Submarket Overview
C. Supply Overview
D. Demand Overview

IV. CHAPTER 4

A. Section 1

B. Section 2

C O N T E N T S

I.

O F

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T A B L E

CONFIDENTIAL MEMORANDUM & DISCLAIMER

O N E
B. Section 2
C. Section 3
D. Section 4

C H A P T E R

A. Section 1

SECTION 1
OFFER FORMAT
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OFFER DUE DATE

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MARKET TOURS
Market tours can be arranged by contacting:
KENNETH P. FRANZESE
Principal
773.355.3005 | Direct
847.456.4213 | Mobile
kfranzese@lee-associates.com
JOHN T. CASSIDY
Principal
773.355.3006 | Direct
312.371.0098 | Mobile
jcassidy@lee-associates.com

TERMS
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SURVEY TITLE
earum aut atum ulluptae. Ihilla

LEE & ASSOCIATES OF ILLINOIS, LLC

9450 W. Bryn Mawr Avenue | Suite 550
Rosemont | Illinois | 60018

SECTION 1

SECTION 2
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SECTION 2
ADDRESS:

Street Address, City, State

BUILDING SIZE:
LAND SITE SIZE:
OFFICE AREA:
CLEARANCE:
BAY SIZES:

246,446 Square Feet

ROOF:
ELECTRICAL SERVICE:
HVAC:
PARKING:
FIRE PROTECTION:
LIGHTING:
LOADING FACILITIES:

EPDM Rubber Membrane Roof

COMMENTS:

New Construction
Prestigious Business Park
Environment
State-of-the-Art Cross-Dock Facility
One to Four Tenant Building

13.51 Acres
To Suit
32 Clear
50 x 50 (Typical)
60 Speed Bay
2400 Amp; 277/480 Volts
Positive Pressure Air-Rotation Units
147 Spaces
ESFR System
High-Efficiency T-5 Lighing
Forty (40) Exterior Docks
(Expandable to 70)
Four (4) Drive-In Doors

SECTION 2

SECTION 2

SECTION 2

SECTION 3

SECTION 2

SECTION 3

SECTION 3

SECTION 3

SECTION 3

SECTION 3

SECTION 3

SECTION 3

SECTION 3

SECTION 3

SECTION 4

SECTION 4
PROPERTY

LOGO

PROPERTY

CITY, STATE
DATE

LOGO

CITY, STATE
DATE

D. SECTION 1

I. HEADING 1

1.

A. SECTION 1

i)

1.
B. SECTION 2

I. HEADING 2

1.

A. SECTION 1

i)

1.

ii)

i)

a)

ii)

b)

2.

2.

i)

i)

ii)

ii)

a)

a)

b)

b)

3.

C. SECTION 3

i)

1.

a)
b)

SECTION 4

SECTION 4

SECTION 4

SECTION 4
PROPERTY

LOGO

PROPERTY

CITY, STATE
DATE

LOGO

CITY, STATE
DATE

b)

B. SECTION 1
ii)

1.

a)

i)

b)

a)
iii)

ii)

a)

a)
2.

1)

i)

2)

a)

2.

b)

i)

c)

a)
3.

b)
c)

i)

C. SECTION 1

ii)
iii)

1.
i)
a)

SECTION 4

SECTION 4

T W O
B. Section 2

C H A P T E R

A. Section 1

SECTION 1

BUILDING SIZE

246,446 SF

LAND SIZE

13.51 Acres

PROJECT DELIVERY

Spring, 2015

NUMBER OF TENANTS
TENANT SIZE RANGE
LEASE UP PERIOD
NET RENTAL ABATEMENT PERIOD
AVERAGE LEASE TERM
OFFICE FINISH LEVEL
LEASE RATE RANGE
ANNUAL ESCALATIONS

1-4 Users
Interior cost estimates based on 2 tenants
50,000 to 246,446 SF
Months 1-12
Months 13-18
Six (6) years
5%
$4.75 to $4.95 PSF
2.5%

PROPERTY TAXES

Paid by tenant

OPERATING EXPENSES

Paid by tenant

UTILITY EXPENSES

Paid by tenant

STABLIZED NOI ESTIMATE

$1,195,000

SECTION 1

Sharon

WISCONSIN
ILLINOIS

Poplar Grove

39

Pecatonica

Loves
Park

McHenry

Bull Valley

90

Oregon

$0.00
$0.00

Leasing Commissions
Miscellaneous Soft Costs/Contingency
TOTAL SOFT COSTS

$000,000
$000,000
$000,000

$0.00
$0.00
$0.00

Sleepy
Hollow

Gilberts

West
Dundee

64

NORTH
KANE

Sycamore

14

Inverness

38

Lily Lake

De Kalb

64

47

Cortland

B. North Kane Submarket Overview

CENTRAL
Maple Park

South
Elgin

D. Demand Overview
Lee

Waterman

Shabonna

Plano
Sublette

Sandwich
DEKA
LA SALLE COUNTY

LEE COUNT Y
LA SALLE COUNTY

251

Somonauk

Yorkville

Montgomery

Earlville

Palos
Hills

Bolingbrook

Palos
Park

Lemont
Romeoville

Homer
Glen

Mendota
La Moille

Newark

Sheridan

Lockport
Crest
Hill

30

Rockdale
Arlington

Cherry

52

Minooka
80
47

71

Channahon

JOLIET
AREA

50

30

Monee

Manhattan

80

Dalzell

De Pue

Morris

Ottawa

Peru

La Salle

North Utica

Marseilles

Spring Valley

Seneca

71

71

Cedar
Point

Mark

I-80 WEST

Standard
251

Tonica

Grand Ridge

Mazon
170

55

Verona

23

89

McNabb

39

53

Gardner
South

912

90

Gary

80

Highland

Griffith
53

Sauk
Village

University
Park

Porter

90

South
Haven

49

30

Merrillville

Valparaiso

55
394

St. John

Crown
Point

Lakes of the
Four Seasons

Cedar
Lake

231

Beecher
Lake
Dalecarlia

Peotone
1

Lakewood
Shores

20

Cheste

Schererville

Steger
Crete

Hobart

65

41

Dyer

S. Chicago
Heights

80

New Lake Station Portage

Chicago

Lansing
Munster

94

Ogden
Dunes

20

41

12

Dune
Acres

Burns
Harbor

Chicago
Heights Ford Heights

57

Wilmington
Diamond
Coal City
Braidwood

INDIANA
Hebron

Lowell

WILL COUNTY
KANKAKEE COUNTY

Kouts

POR
T ER
JASP COUN
ER
TY

65

102

Godley
Braceville
Schneider
OUNTY
COUNTY

Carbon Hill

Oglesby
Hennepin

50

East
Chicago

Hammond

Lynwood

SOUTH
WILL

45

Ladd
Seatonville

SOUTH
COOK
Olympia Fields

Matteson
Richton Park
Park Forest

Frankfort

Elwood

Phoenix

Harvey

57
6

52

53

Burnham
Calumet
City

South
Holland
East Hazel Crest
Hazel
Country Crest Homewood Thornton
394
Club Hills
1 Glenwood
Flossmoor

KENDALL COUNTY
GRUNDY COUNTY

Whiting
20

Markham

Frankfort
Square

Preston Heights

12

83

Oak Forest

Mokena

30

94

Calumet Park

Robbins
Riverdale
Posen Dixmoor Dolton

Crestwood

Orland
Hills Tinley
Park

New Lenox

Joliet

Shorewood

52

Lisbon

Troy
Grove

80

Ingalls
Park

Alsip Blue
Island

Midlothian

Orland
Park

Fairmont

55

89

45

Merrionette
Park

50
294

12

20

Evergreen
Park

Chicago
Ridge

Palos
Heights
43

Plainfield

Millington

Worth

30

71

23

94
90

90

Oak
Lawn

55

171

34

92

34

43

83

LEE COUNTY
BUREAU COUNTY

SOUTH
CHICAGO

I-55
I-55
SOUTH NORTH

355

59

Leland

39

55

45

DU PAGE COUNTY
WILL COUNTY

I-88
CORRIDOR

34

Chicago

171
34

34

Oswego

23

290

Cicero

53

Paw Paw

52

64

38

294

88

Woodridge

30

50

WEST
COOK
Broadview

CENTRAL
DU PAGE

Naperville

KANE COUNTY
KENDALL COUNTY

Amboy

NORTH
CHICAGO

43

Elmwood
Park

Northlake
Melrose
Park
Berkeley
Maywood
Bellwood
Forest Park
Hillside

83

Lisle

34

171

Franklin
Park

53

Sugar Grove
47

Schiller
Park

45
64

56

Lincolnwood
90

Addison

Glen Ellyn

Evanston
Skokie

Niles

Park Ridge

19

Winfield

Wilmette
41

Rosemont

290

Glendale
Heights

88

Golf
Morton Grove

294

Elk Grove
Village 83

355

Hinckley
30

Des
Plaines

O'HARE
Itasca

19

Warrenville

North
Aurora

94

45

Carol
Stream

Wheaton

43

21

72

Lake
Michigan

Glencoe

NORTH Winnetka
Northfield Kenilworth
Glenview
COOK

45

Prospect
Heights

58

290

West
Chicago

Aurora

Compton

20

38

Deerfield

58

NORTH Bloomingdale
DU PAGE
64

Batavia

30

30

Bartlett
59

St. Charles

KANE

88

C. Supply Overview

Roselle

Wayne

Elburn

Steward

COOK COUNTY Park

DU PAGE COUNTY

Highwood
Highland
Park

Northbrook

12

Hoffman Estates

38

88

68

Prospect

Hanover

Geneva

Riverwoods

53

58

Bannockburn
41

Buffalo
Grove

Wheeling

Palatine

Streamwood Schaumburg

Virgil

Malta

Rochelle

29

SECTION 2

83

94

21

Lincolnshire

22

NORTHWEST Arlington
Heights
South
Barrington COOK
Rolling
Meadows Mount

72

25

Elgin

20

23

Creston

$0.00

*costs exclude carry during lease-up.

I-39 CORRIDOR

A SALLE
RUNDY

$0,000,000

Pingree
Grove

Burlington

Hillcrest

AM COUNTY
LE COUNTY

TOTAL PROJECTED FIT-OUT & LEASE UP EXPENSES

72

Lake
Forest

LAKE COUNTY
COOK COUNTY

59

68

East Dundee

A. Metro Chicago Market Overview

BUREAU COUNTY
LA SALLE COUNTY

$00,000
$000,000

47

Hampshire

14

62

Carpentersville
Genoa

Lake Zurich
Kildeer Long
Grove
Deer Park

Barrington Hills

90

Kingston

72

64

38

Liability Insurance
RE Taxes & CAM During Lease Up

39

Davis Junction

Indian
Creek

North Barrington

Barrington

KANE COUNTY

Lake
Bluff

60

90

Ashton

$0.00

Fox River
Grove

Green
Oaks

Libertyville
Mundelein

Hawthorn Woods

12

22

Algonquin

McH

Kirkland

Franklin Grove

$00,000

BOONE COUNTY
DEKALB COUNTY

251

OGLE COUNTY
LEE COUNTY

SOFT COSTS
Legal - Leasing ($5,000/Tenant)

Cary
Trout
Valley

137
45

Vernon Mettawa
Hills

Tower
Lakes
Lake
Barrington

KANE COUNTY
DU PAGE COUNTY

$0.00
$0.00
$0.00

Crystal Lake

Huntley

WINNEBAGO
OGLE COUNTY

Stillman
Valley

Oakwood
Hills

Lake in the Hills

New Milford

176

KENDALL
WILL COUNTY

Included
$000,000
$000,000

Byron

Island
Lake

GRUNDY COUNTY
WILL COUNTY

Warehouse HVAC (2 80/20 MVA Units)

Office TI Allowance (5% at 65 PSF)
TOTAL HARD COSTS

176
14

Lakewood

Union

RD.

$0.00
$0.00
$0.00

20

59

176

Marengo

20

RANDALL

$000,000
$000,000
Included

Belvidere
Cherry
Valley

DEKALB COUNTY
KANE COUNTY

Demising Walls (per plan - 2 tenants)

Utilities (2 tenants)
Warehouse Lighting (25 FC-Open Plan)

Prairie
Grove

47

20

OGLE COUNTY
DEKALB COUNTY

$/SF

Rockford

LAKE
COUNTY
Wauconda

Holiday Hills

31

23

Winnebago

Lakemoor

Woodstock

LEE COUNTY
DEKALB COUNTY

COST

Johnsburg

McCullom
Lake
120

20

HARD COSTS

Ringwood

Greenwood
Wonder Lake

O V E R V I E W

PROJECTED COSTS AFTER COMPLETED SHELL - 246,446 SF

McHENRY
COUNTY

14

173

M A R K E T

Capron

LAKE
COUNTY
COUNTY
PORTER

Harvard

Machesney
Park

Zion

Wadsworth Beach
Fox Lake
Park
94
Lindenhurst
Fox Lake
Hills Lake Villa
Venetian Village
Pistakee
137
Round
Highlands
Grandwood Park
Lake Round
132
Heights Lake
Gurnee
Third Lake
Beach
Long
83
Lake
41
12
Park City Waukegan
21
Round Lake
Grayslake
120
Round Lake
Park
North
Chicago
Volo
60 Hainesville

76

ILLINOIS
INDIANA

251

173

Old
Mill
Creek

45

59

AVE.

Roscoe

173

Spring Grove

McHENRY COUNTY
LAKE COUNTY

75

Winthrop
Harbor

Antioch

12

47

BOONE COUNTY
McHENRY COUNTY

Durand

83

Richmond

173

Hebron

WESTERN

WINNEBAGO COUNTY
BOONECOUNTY

Rockton

SECTION 2

23

WILL COUNTY
COOK COUNTY

Beloit
South Beloit

41

Y
NT
OU NTY
E C
LAK
COU
TON
NEW

De Motte

Wheatfield

METRO CHICAGO MARKET OVERVIEW

12

14
94
294

90

Hoffman Estates

Des
Plaines
290
Schaumburg
Elk Grove 90
Village
Ha
in O' re Expy.
Elg
O'Hare
International
Airport

Elgin

Site

20

KANE

25

DU PAGE

31

41

Statistically,
the
Chicago
industrial
market consists of approximately 1.3
billion square feet, making it the third
largest in the United States. At the
end of Q1 2014, the market had a
vacancy rate of 9%. This vacancy has
fallen from its peak in mid 2010. Overall,
the Chicago industrial market absorbed
over 42 million square feet in 2012 and 38
million square feet in 2013.

Millions of SF Absorbed

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41
N
LAKE

14

14.0%

12

12.0%

10

10.0%

8.0%

6.0%

4.0%

2.0%

Vacancy

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METRO CHICAGO MARKET OVERVIEW

94

290

Chicago

St. Charles
Lombard

290

COOK

45

55

20

88

Midway
Airport

294

355

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014

Gross Absorption

20

0.0%

Vacancy

59

30

294

57

55

WILL

KENDALL

80

Joliet
45

30
80

5 Mi.
METRO CHICAGO MARKET OVERVIEW

METRO CHICAGO MARKET OVERVIEW

METRO CHICAGO MARKET OVERVIEW

NORTH KANE SUBMARKET OVERVIEW

Inventory

Available SF

Vacancy

Under Construction

Q1 Sold

Q1 Leased

Q1 Gross Absorption

Q1 Net Absorption

Central DuPage

22,599,060

1,341,601

5.9%

51,904

11,880

51,904

-330,895

Central Kane

36,087,685

2,865,233

7.9%

51,015

69,712

120,727

-83,124

Chicago North

116,079,666

8,736,944

7.5%

761,146

108,060

869,206

227,627

Chicago South

157,946,564

11,035,173

7.0%

150,000

242,480

623,597

866,077

205,060

I-55 Corridor North

54,124,402

5,363,741

9.9%

760,359

119,610

581,189

700,799

343,506

I-55 Corridor South

91,703,656

7,666,427

8.4%

2,089,445

59,579

1,387,585

1,447,164

403,567

I-88 Corridor

64,090,530

4,733,526

7.4%

1,480,584

258,100

80,352

338,452

221,344

Joliet Area

60,928,634

9,314,020

15.3%

2,741,400

77,087

1,905,600

1,982,687

615,592

Lake

83,353,004

8,024,061

9.6%

202,007

397,744

599,751

-962,436

McHenry

27,433,832

2,544,116

9.3%

339,070

97,115

436,185

168,320

North Cook

42,911,907

2,417,587

5.6%

926,975

274,932

1,302,907

947,185

North DuPage

67,204,729

6,086,143

9.1%

265,000

150,938

379,635

379,635

-1,005,855

North Kane

34,208,664

4,538,412

13.3%

306,000

25,000

47,173

72,173

-419,933

Northwest Cook

48,666,730

4,247,835

8.7%

300,000

191,277

121,468

312,745

106,366

106,476,539

10,851,189

10.2%

630,545

332,428

1,107,122

1,439,550

279,821

South Cook

58,872,747

4,947,578

8.4%

297,819

90,457

388,276

-289,865

South Will

25,415,424

2,390,153

9.4%

353,683

39,382

423,065

359,315

West Cook

95,071,075

10,095,232

10.6%

887,637

75,080

962,717

600,778

1,193,174,848

107,198,971

9.0%

8,723,333

5,327,755

7,398,083

12,694,020

1,386,373

Indiana (Northwest)

42,150,958

4,204,115

10.0%

550,228

264,387

85,204

349,591

117,108

Indiana (Northwest
Non-Crane)

26,891,153

2,404,256

8.9%

550,228

264,387

264,387

31,904

Wisconsin (Southeast)

52,104,463

3,086,088

5.9%

1,816,000

126,188

76,484

202,674

147,254

I-39 Corridor

65,658,635

7,959,642

12.1%

15,000

15,000

15,000

1,353,088,904

122,448,816

9.0%

11,089,561

5,733,330

7,559,771

13,261,285

1,665,735

OHare

Totals

Totals

No warranty or representation is made as to the accuracy of this information. Data that has been analyzed and summarized here is from sources deemed reliable.

METRO CHICAGO MARKET OVERVIEW

HISTORICAL PERSPECTIVE
The North Kane Submarket comprises 34.2 million SF of industrial space,
with the majority of the Class A inventory having been developed over
the past 15 years. The area has enjoyed steady growth due to a variety
of catalysts such as:
Plentiful and diversified labor base
Low Kane County property taxes
Modern infrastructure offering 3 full interchanges along I-90, which is
the longest interstate highway in the U.S. and northern most coast-tocoast trade route.
Excellent area amenities and good housing stock.
Communities are very pro-business and pro-development.
The North Kane County submarkets initial growth was spurred
by manufacturing and production operations throughout the
60s, 70s and 80s. This submarket then began to emerge as a
leading distribution market in the 90s, growing at a steady pace
and it remains a competitive and sought after market for users and
investors.

POPULATION
State of Illinois
Kane County (6th Largest)
City of Elgin (8th Largest City)

2000

2010

% CHANGE

12,419,293

12,830,632

3.3%

404,119

515,269

27.5%

94,487

108,188

14.5%

The close proximity and easy access to OHare International Airport as well as two metro commuter rail stations connecting the area to
Chicago has enabled the North Kane submarket to be a part of Chicagos nexus of globalization with a multitude of international firms
having located here such as Seimens- Wynergy Division, NTN Bearing, Bohler Uddeholm, Federal Signal and many others.
Elgin also hosts numerous corporate headquarters for major companies such as J.B. Sanfilippo & Sons (Fisher Nuts), Box Packaging,
CTDI, Colony Display, Weber-Stephens (Weber Grill) and Elgin Sweeper.
The City of Elgin enjoys the largest industrial base in this submarket and has consistently maintained a very pro-business and prodevelopment philosophy. Municipal leaders have also re-invested heavily in infrastructure and a revitalization of the downtown area
to ensure continued growth. There is an excellent housing stock as well as community gems such as Elgin Community College which
contribute greatly to the sought-after workforce in the area.

NORTH KANE SUBMARKET OVERVIEW

SUPPLY OVERVIEW

SUPPLY OVERVIEW

A detailed summary of the current class A industrial inventory appears on the following pages. These options comprise the existing
supply of space from 50,000 square feet and up, that offer at least 28 ceiling clearance, modern distribution center amenities and are
located within the North Kane County Submarket.
Currently, there are ten (10) options available with the following highlights
Total Space Available:

1,553,582 SF

Average Unit Size: 86,310 SF

Class A Vacancy Rate:

4.54%

It is important to note that the second largest vacancy, although newer and 30 clear, is very functionally limited as a single-load facility
that is over 400 deep. If we were to exclude this option as part of the primary competition, the vacancy rate for this segment of the
market would drop to 3.66%.
Additionally, there are three (3) users actively negotiating leases on 375,000 SF of this space. We anticipate that these transactions will
be completed within the next sixty (60) days and all require occupancy this year. This will bring the vacancy rate for this segment of the
market down below 3%! Lastly, as you will see later in this section, there is qualified demand from users in this submarket actively requiring
1.8 to 2.5 million square feet of space, which clearly demonstrates the pending supply shortage and supports the need for this new
project.

SUPPLY ANALYSIS

INSERT CHART

SUPPLY ANALYSIS

DEMAND OVERVIEW- ACTIVE PROSPECTS

DEMAND OVERVIEW - LEASE TRANSACTIONS

PROSPECTS IN THE MARKETPLACE

SF Range
North Kane Submarket
Updated June 2014
PROSPECT

MINIMUM SF REQUIREMENT

MAXIMUM SF REQUIREMENT

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

0,000,000

0,000,000

TOTALS:

INSERT CHART

USER DEMAND ACTIVITY

LEASE COMPARABLES

B. Section 2

CHAPTER FOUR

A. Section 1

SECTION 1
A

a
b

c
d

e
f

E
F

VISIT OUR WEBSITE

G
H

SECTION 1

SECTION 2

SECTION 2

INSERT BROCHURE

INSERT BROCHURE

SECTION 2

SECTION 2