A real estate auction in October delivered more than a deal — it offered Singerman Real Estate a second shot at reshaping Skokie’s life sciences future.
Singerman recently paid $3.3 million to acquire the vacant 135,850-square-foot building at 8030 Lamon Avenue, the last remaining research facility within the Illinois Science & Technology Park in Skokie, Crain’s reported. The deal includes an adjacent 1.3-acre parcel, which could be developed into a parking garage, and adds to Singerman’s $75 million purchase of 8025 and 8045 Lamon Avenue in 2021.
The price, a little over $24 per square foot, demonstrates the challenges developers face in leasing lab spaces, particularly in secondary markets like Chicago.
The vacancy rate for local life sciences properties stands at 40 percent, more than double the average rate of 17 percent across the nation’s top 13 life sciences markets, according to CBRE.
American Landmark Properties acquired the five-building campus in 2017 for $77 million, aiming to capitalize on the life sciences boom driven by the pandemic. Its investment has paid off, with the Singerman deals and the $36 million sale of a fully leased building to a Florida-based TopMed Realty in 2021.
Parts of the campus leased up, but 8030 Lamon remained vacant, even after American Landmark invested $21 million to modernize the building with features like a glass curtain wall, elevators, a tenant lounge and a small wet lab. After failing to secure a tenant, the company auctioned the property in October.
By purchasing the properties at discounted prices, Singerman avoids the financial risks associated with ground-up development or costly redevelopments. The building’s zoning flexibility, which allows for research, manufacturing and office uses, leaves multiple options open.
However, competition from newer developments poses a challenge. Evanston Labs, near Northwestern University, has already attracted Cour Pharmaceuticals away from the Skokie campus.
Despite broader challenges with the Chicago life sciences market, including an oversupply of lab space, Singerman sees potential.
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The acquisition is a valuable addition to the firm’s existing ISTP portfolio, which is 96 percent leased across its two other buildings, its managing principal and founder Seth Singerman said.
Singerman focuses on investments ranging from $20 million to $250 million. Its decision to double down on life sciences highlights confidence in the sector’s long-term growth, even amid short-term volatility.
— Andrew Terrell