Silverman Group has doubled the size of its Chicagoland commercial property portfolio.
The New Jersey-based real estate investment firm spent about $102 million on a 925,000-square-foot collection of low-slung buildings aimed at light industrial and office tenants in the northern and northwest suburbs of Chicago, public records show. The price was about $110 per square foot.
The seller was San Francisco-based Stockbridge Capital Group, which has offloaded a series of Chicago-area industrial, multifamily and office investments in recent years. Stockbridge paid $63.4 million ($69 per square foot) to buy the buildings in 2019, property records show.
The properties are in Buffalo Grove, Vernon Hills and Elgin, and include 17 buildings that were 92 percent leased at the time of sale. The deal brings Silverman’s Chicago-area portfolio to just under 2 million square feet, according to a news release.
“Smaller flex space has proven to be a critical asset for businesses looking for highly functional and well-located industrial facilities,” the firm’s president Blake Silverman said in a statement. “Expanding our presence in Chicago further underscores our confidence in the strength and resilience of both the product and the market.”
Its business parks include:
- Buffalo Grove: 1601 Barclay Boulevard, an eight-building complex spans 406,400 square feet with versatile single-story structures. Valued at $44.7 million.
- Vernon Hills: 100 North Fairway Drive, a five-building complex totaling 281,300 square feet, completed in the late 1990s. Valued at $31 million.
- Elgin: 2511 Technology Drive, a four-building complex totaling 237,600 square feet, suitable for manufacturing and distribution. Valued at $26.2 million
Big portfolio trades have been in vogue lately in Chicago’s industrial sector, which has been stabilizing in recent months from the pandemic-induced boom in demand. CBRE’s investment arm last month sold off a nearly 1.4 million-square-foot industrial portfolio in the region for about $114 million. That included a $40 million valuation of a Joliet property — about the same price it fetched from CBRE back in 2017, despite being vacant at the time of its latest sale to a partnership between Rosemont-based Venture One and New York-based DRA Advisors.
That deal illustrates how the demand for big-box spaces such as the Joliet property surged in the early days of the pandemic and has subsided a bit as developers rushed to build new supply.
Mike Tenteris, Adam Tyler and Jim Carpenter with Cushman & Wakefield represented Stockbridge in its sale to Silverman. Stockbridge didn’t return a request for comment.
The buyer hinted it may pour more cash into its acquisitions by undertaking some renovations for upgrades.
“As part of our strategy, we are rebranding the parks and exploring ways to optimize the portfolio,” Silverman said. “This includes repurposing select spaces into light industrial and flex configurations to better meet the needs of small business tenants.”
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