• REIT To Invest Almost $285 Million on Chicago-Area Industrial Properties, Including Big Amazon Wareh

    A Denver-based real estate investment trust is paying almost $285 million for 15 warehouses in the Chicago area, including a pending deal for a big Amazon distribution center southwest of the city.

    Ares Industrial Real Estate Income Trust expects to complete a $102.5 million purchase of the 753,000-square-foot Amazon warehouse in the third quarter, according to securities filings. That property, at 23700 W. Bluff Road in Channahon, Illinois, is owned by IDI Logistics.

    That deal follows a 14-building portfolio purchase last month for $182 million, according to filings, CoStar data and property records. The sale by KKR included one building in Chicago and 13 in the suburbs.

    It adds to an industrial spending spree that reached record volumes in the Chicago area and nationally last year. The rally has shown few signs of slowing, despite concerns about the economy and Amazon — a prolific user of distribution space — tapping the brakes on its aggressive real estate expansion.

    Real estate investors gobbled up $125 billion worth of industrial properties in 2021, including $8.6 billion in the Chicago area, both record volumes, according to CoStar data. Thus far in 2022, there have been more than $40 billion in deals nationally and $2.4 billion in the Chicago market.

    Prologis, already the country’s largest industrial landlord, has a $26 billion, all-stock deal to absorb another of the largest industrial owners, Duke Realty.

    Developers continue building aggressively to keep up with demand. One of them, Chicago-based Molto Properties, said it is set to break ground on two large projects southwest of Chicago totaling more than 2.6 million square feet.

    Ares and New York-based KKR, also known Kohlberg Kravis Roberts, declined to comment. IDI did not respond to a request for comment.

    Atlanta-based IDI is owned by Montreal-based Ivanhoe Cambridge and Toronto-based Oxford Properties Group.

    The 15 warehouses the Ares REIT is adding are fully leased, the largest of which is the 5-year-old Amazon warehouse southwest of Chicago near Joliet.

    The portfolio Ares bought from KKR has more than 1.7 million square feet of space combined. The largest property is a 310,775-square-foot warehouse at 4404 W. Ann Lurie Place on Chicago’s Southwest Side, which is leased to three tenants, according to CoStar data.

    The deal includes four buildings far west of Chicago in Elgin at 1765 and 1925 Holmes Road, 2000 Fox Land and 2541-2545 Millennium Drive. Another four buildings are far north of Chicago in Libertyville at 801, 901 and 1011-1013 Technology Way and 1940 USG Drive.

    Also in the portfolio are warehouses at 20W267 and 20W345 101st St. in Lemont and at 320 and 755-777 Remington Blvd. in Bolingbrook. The other structure is at 1411-1415 Enterprise Drive in Romeoville.

    Source: www.CoStar.com