Peter Borzak’s Pine Tree became the latest Chicago retail landlord to cash in on a nearby apartment development that added density to a neighborhood.
Realty Income, based in San Diego, bought a 40,000-square-foot retail strip on Chicago’s busy Six Corners intersection for $12.6 million from an entity sharing an address with Pine Tree, based in suburban Northbrook. The property at Milwaukee and Cicero Avenues, leased to Ross Stores and the chain dd’s Discounts, last changed hands in 2016 for $7.6 million, public records show.
Sears redevelopment at 4730 W. Irving Park Road (Google Maps)
The $5 million increase in the valuation reflects higher profit margins that property owners can achieve when multifamily developers move in. Pine Tree sold months after the Chicago City Council approved Novak Construction’s redevelopment of the former Sears store across the street at 4730 West Irving Park Road into 207 apartments. All but six of them are planned to be market rate, a mix of studio, one- and two-bedroom units ranging from $2,750 to $3,000 per month, and Target is set to be the redevelopment’s retail anchor tenant across 44,000 square feet of about 50,000 that are planned.
Realty Income’s new retail property is also getting a boost from the redevelopment of 4715 West Irving Park Road just to the north into a 10-story, 258-unit Clarendale housing complex for people 62 and older, scheduled for completion this year. An Aldi grocery is set to occupy the ground-floor retail after the project had been previously rejected by the 45th Ward Alderman Jim Gardiner.
Realty Income declined to comment on its purchase. Pine Tree didn’t respond to requests for comment.
Developers aren’t finished with proposing changes to Six Corners. A two-story medical office redevelopment of a former parking lot right next to the retail Pine Tree sold Realty Income is underway. In addition, local developer GW Properties is seeking approval for its Shops at Six Corners that would transform a former warehouse east of the intersection of Milwaukee, Irving Park and Cicero into 110 apartments and five retail buildings on the 100,000-square-foot lot.
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