Prologis purchase of Medical District warehouse shows Chicago industrial market’s strength

The deal for the Hastings Street property was a sharp increase in price from what R2 paid for it in 2014

Chicago /
Jan.January 07, 2019 02:30 PM

R2’s Managing Principal Matt Garrison, and 2059-2061 West Hastings Street (Credit: Showcase and Twitter)

Prologis bought an 85,000-square-foot warehouse in the Illinois Medical District for nearly twice what R2 Companies paid four years ago, highlighting the continued demand for last-mile industrial assets.

Chicago-based R2 bought the property at 2059-2061 West Hastings Street in 2014 for $3.9 million, and sold it to warehouse landlord Prologis on Dec. 27 for $7.1 million. The most recent purchase works out to $84 per square foot.

The building’s major tenant is Rush medical center, which is moving out next year.

The deal illustrates the demand for last-mile delivery assets from institutional buyers, and a recent panel of leaders convened by NAIOP said the dwindling availability of vacant land is slowing mega-scale industrial construction, with developers now shifting to a broader base of smaller infill projects.

“You’re seeing the market get stronger the smaller you get,” Matt Goode, a principal of the Rosemont-based Venture One Real Estate, said during the event.

Prologis last year made big investments in industrial space, acquiring rival logistics owner DCT Industrial Trust’s 71 million square feet for $8.4 billion in stock and giving the company more exposure to key markets like New York, Southern California and South Florida.

R2, meanwhile, has been active across the Chicago market lately, listing two West Loop buildings it bought with Walton Street Capital for $55 million a couple months after buying a landmark Old Town building with plans to renovate it.

The firm last year announced it was moving its Chicago headquarters from the West Loop to a freshly-renovated 55,000-square-foot building on Goose Island, near where a number of buildings in its portfolio are located.


Related Articles

arrow_forward_ios
3600 River Road in Chicago and Colliers' Mike Senner with arrows dramatically trending down
Warehouse vacancy falls to yet another record low in Chicago
Warehouse vacancy falls to yet another record low in Chicago
Clear Height's Dominic Sergi with 875-1036 Northpoint Boulevard, 2650 Corporate Parkway and 1380 Gateway Drive in Elgin (Clear Height Properties, Rothbart Realty)
Clear Height beefs up Chicagoland industrial holdings for $100M
Clear Height beefs up Chicagoland industrial holdings for $100M
Alessio Tropeano, Phil Stafford, Emily Marquardt and Tanner Hayes (LinkedIn, Centerpoint, Getty)
Movers: Stafford to head BOMA, Avison snags former Telos broker, more
Movers: Stafford to head BOMA, Avison snags former Telos broker, more
R2's Matt Garrison with 1200 North Branch Street (R2 Companies)
R2 Companies inks 54,000 sf in Goose Island office leases
R2 Companies inks 54,000 sf in Goose Island office leases
From left: Pearlmark's Stephen Quazzo and Conning's Woody Bradford
Conning buys majority of Pearlmark amid $400M distressed property fund launch
Conning buys majority of Pearlmark amid $400M distressed property fund launch
SL Green's Marc Holliday with 181 West Madison Street
SL Green wins rejection against HNA transfer of Loop tower
SL Green wins rejection against HNA transfer of Loop tower
19 South LaSalle Street (Wikipedia)
Espinoza Venture faces $21M foreclosure on LaSalle office building
Espinoza Venture faces $21M foreclosure on LaSalle office building
Alderman George Cardenas (Cardenas for Cook, Getty)
Chicago alderman resigns, gears up to join property tax board
Chicago alderman resigns, gears up to join property tax board
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...