The St. Louis office market continues to see a relatively slow pace of activity. As the economic downturn hit the market slightly later than the rest of the country, the recovery is also delayed, and companies continue to be cautious, with renewals dominating the leasing market. As of the end of the third quarter, the market-wide vacancy rate was 16.3 percent, slightly lower than second-quarter figures. The vacancy rate has stayed steady between 15.5 and 16.5 percent for the past 5 quarters. Firms continue to employ the blend-and-extend strategy of extending leases before the expiration date and locking in a lower lease rate at the same time. While asking rates have remained relatively steady, effective rates are lower than 2 or 3 years ago, and concessions, including free rent, are still being used by landlords to entice potential tenants in most submarkets. Much of the activity within the marketplace is being seen at smaller sizes, between 3,000 and 5,000 square feet, with a dearth of large tenants in the market. Exceptions to this include Panera Bread, which recently leased 71,130 square feet at 3630 South Geyer Road. Recently, the St. Louis office market was dominated by the moves of several …
Midwest
BELLWOOD, ILL. — Anthony Leeds of Darwin Realty & Development Corp. represented a private investor in the purchase of two industrial properties in Bellwood. Located at 2600 and 2744 Washington Blvd., the properties total 119,000 square feet of industrial space. The acquisition price was not released. Ryan Kehoe of Grubb & Ellis represented the seller, DeNovo Property Trust, in the transaction.
NORTHFIELD, ILL. — Guardian Home Health & Hospice has acquired Northfied West, a 25,370-square-foot office building located in Northfield. The property was purchased for $1.8 million. Attorney Mort Rubin represented the buyer, while Greg McCormick of Garfield & Merrill represented the seller in the transaction. The building was sold on behalf of a consortium of banks that held the loan. In March 2009, Daniel Hyman of Millennium Partners R/E Inc. was appointed receiver of the property.
PEWAUKEE, WIS. — Caliendo Promotions Inc. has signed a lease for 32,000 square feet of warehouse/industrial space at Roundy Business Park in Pewaukee. The tenant will use the new space, located at W22N2792 Duplainville Road, to expand its promotional item distribution operations. James Young of Milwaukee-based Cassidy Turley Barry represented the tenant; the landlord, Burbach Cos., has in-house representation in the transaction.
CHICAGO — ProLogis has signed a fourth-quarter build-to-suit expansion agreement for 337,000 square feet with Bay Valley Foods, a provider of private label food products. Bay Valley Foods currently occupies 620,000-square-foot, LEED Silver certified facility at ProLogis Rochelle, which was developed in 2008 for the customer. The new project will be an expansion of Bay Valley's existing building. Bay Valley plans to use the new space as additional warehouse and distribution space. The 13.8-acre project is an expected $11.6 million investment.
RACINE, WIS. — Racine Unified School District has selected Bukacek Construction to construct a two-story addition and renovation at Fratt Elementary School, which is located at 3501 Kinzie Ave. in Racine. The $2.9 million, 17,270-square-foot project will include a new library, a cafeteria and classrooms. The renovation of the existing space will provide a new art room, a band room and a speech room. Boer Architects is providing architectural services for the project, which is scheduled for completion in June 2011. Upon completion, the project is expected to achieve LEED Silver certification.
CHICAGO — Strategic Storage Trust Inc. has acquired three self-storage facilities totaling 281,000 rentable square feet with approximately 2,030 units. The assets include 1000 E. 95th Street in Chicago, which offers 690 units with 72,000 rentable square feet; 2244 S. Western Ave. in Chicago, which features 590 units with 59,000 rentable square feet; and 5701 W. Ogden Ave. in Cicero, Ill., which offers 750 units with 65,000 rentable square feet. The facilities will be rebranded under the SmartStop SM Self Storage trade name. Terms of the transaction were not released.
BRIDGETON, MO. — The Junior College District of St. Louis, dba St. Louis Community College, has acquired the Marcasco Building, which is located at 3221 McKelvey Road in Bridgeton. Situated on approximately 9 acres, the 149,553-square-foot property sold for $5.5 million. The college plans to invest $3.6 million in renovations to the building, including a first phase upgrade of 27,000 square feet. The instructional space will include dedicated-purpose labs, eight to 10 classrooms, conference/meeting/seminar breakout rooms, a multipurpose room, computer training labs and a Prometric/Ceriport testing center. The college's phased move-in is scheduled to begin in spring 2011. Stephen Gwinnup of Coldwell Banker Commercial CRA represented the buyer; Cassidy Turley represented the sellers, Crusader LLC and Regions Bank, in the transaction.
NAPERVILLE, ILL. — MKW 1200 Warrenville Road LLC, a joint venture between Daniel Murphy, William Krug, Larry Krueger, and Wanxiang America Real Estate Group, has commenced the renovation of 1200 Warrenville Road in Naperville. The 330,000-square-foot vacant office building will receive a new state-of-the-art energy-efficient HVAC system and new building systems, washrooms and a lobby. FCL Builders is serving as general contractor; David McCarty of Chicago Design Network is providing architectural services for the project. MKW 1200 Warrenville Road LLC acquired the four-story office building, which was built in 1981. Bill Ellwood and Jeffrey Mann of CB Richard Ellis have been retained to lease the property.
LOMBARD, ILL. — Jones Lang LaSalle, acting on behalf of Dental Networks of America, has selected Elmhurst, Ill.-based J.C. Anderson Inc. to complete a 60,000-square-foot office build-out in Lombard. The project will utilize a portion of the existing space while adding new design features, including the construction of multiple offices, conference rooms, a kitchen area, break rooms, classrooms and private executive offices. Dental Network of America, a wholly owned subsidiary of Health Care Service Corp., a Mutual Legal Reserve Co., is relocating its corporate headquarters to 701 E. 22nd St. in Lombard from its previous location in Oakbrook Terrace, Ill. Partners by Design is providing architectural services and OWPP is serving as project engineer for the project, which is scheduled for completion in February 2011.