KPR Centers Buys Suburban Chicago Retail for $40 Million

A New York investment firm is doubling down on suburban Chicago retail.

KPR Centers acquired Pointe Plaza, a 195,000-square-foot shopping center in north suburban Niles at 5660 West Touhy Avenue, for $40 million, Crain’s reported.

CBRE brokers Richard Frolik, George Good and Christian Williams represented the seller, San Francisco-based Stockbridge. The price amounts to $205 per square foot. The center was built in 1999.

The deal marks KPR’s second Chicago-area retail acquisition, following its 2021 purchase of Schaumburg Corners, and adds to a national buying spree that’s scooped up more than a dozen centers over the past 20 months.

A thin development pipeline and surging tenant demand, combined with sustained consumer buying habits, has turned retail real estate, long out of favor with investors, into a darling asset class.

Still, the sale price reflects the bite of higher interest rates: Stockbridge paid $50.3 million for Pointe Plaza in 2014, meaning KPR picked up the property at a roughly 20 percent discount.

The shopping center is 94 percent leased, according to KPR. Anchors include Fresh Farms, Ross Dress for Less, dd’s Discounts and Daiso, alongside more than 20 other retailers and restaurants.

KPR COO Andrew Frank said the firm plans to aggressively lease the center’s two vacancies with tenants that would complement the roster.

Retail fundamentals continue to perform. National shopping center vacancy is about 4 percent, according to the International Council of Shopping Centers, with leasing activity surpassing pre-pandemic levels and rents climbing amid constrained supply.

KPR owns and manages more than 10 million square feet of retail space across 20 states. Pointe Plaza likely fits its strategy of targeting well-located suburban centers.

Elsewhere in Niles, the Sterling Organization has a $440 million redevelopment of the Golf Mill Shopping Center in the works, one of several suburban Chicago malls poised for dramatic and costly transformations.

— Eric Weilbacher