Staples Sells Suburban Chicago Property for $22M

Office supply giant Staples has untethered itself from some suburban Chicago real estate. The company sold off the Lincolnshire headquarters of one of its subsidiaries for almost $22 million.

The property at 100-120 Schelter Road in Lincolnshire, home to office supplier Quill, was sold for $21.8 million by an LLC sharing an address with Staples’ Massachusetts headquarters, according to Lake County public records. The buyer was another Chicagoland company, Arlington Heights-based vitamins and supplements manufacturer Carlson Labs.

The buildings on the property total 387,000 square feet, which includes two Class B office buildings at a combined 174,000 square feet and a 213,000-square-foot warehouse facility, according to an online listing from CBRE. The property covers about 30 acres and is located near Interstate 94.

Quill and Staples did not return requests for comment. Staples acquired the smaller company in 1998. Carlson Labs did not return a request for comment.

The property was built in the 1970s and 1980s, according to the listing. A marketing brochure from CBRE pitches several redevelopment possibilities for the property, including expanding the existing facility and constructing more buildings.

Though suburban office leasing volumes remained in a lull last quarter, several multi-building office campuses in Lake County suburbs have traded hands this year, including another recently sold for $42 million to an owner-occupier, as Carlson may soon become. That’s the price credit union BCU paid to its former longtime landlord JMS Capital Group for the financial institution’s own offices in Vernon Hills in October.

At the top end of the multi-building Lake County office property market, Spring Valley, New York-based Northeast Capital Group paid Apollo Global Management $190 million for a 1.1-million-square-foot asset known as the Kemper Lakes office park, which was 94 percent leased with long-term tenancy in place just before the deal, which was the priciest in the suburban Chicago since 2005 at the time.

Still, the suburban Chicago office market was slow in terms of both leasing and sale velocity as owners monitored rising interest rates and tenants reevaluated their needs as the pandemic evolves, according to Colliers. Class A properties drew the most leasing while there was a wave of auction sales among Class B office properties. The area had a 26 percent vacancy rate, according to the report.

In terms of industrial properties such as the warehouse on Carlson’s newly acquired campus, Lake County’s vacancy rate was 4.4 percent with almost 89 million square feet of inventory and 461,000 square feet of industrial space under construction, according to the brochure. CBRE attributed the submarket’s success in part to Lake County’s low real estate taxes compared to neighboring counties.