A joint venture involving Chinese Wanxiang America Real Estate Group and Chicago-based Clarius Partners LLC, recently announced plans to build a 400,000-square-foot cold storage warehouse in Pilsen, near the lower West side of Chicago, in hopes to attract food companies getting pushed out of the Fulton Market corridor.
The venture between Clarius Partners and Elgin-based Wanxiang, who paid $6.6 million in February for the 23-acre site, has started with demolition of a vacant warehouse on the property to make way for the development, Wanxiang Managing Director Larry Krueger told ChicagoRealEstateDaily.com.
“We think there's demand that's relatively unsatisfied,” he said.
In Pilsen, Wanxiang sees an opportunity to deliver a modern warehouse to food companies and distributors displaced by tech firms and other businesses flocking to Fulton Market, in turn raising rents and forcing out the produce and meatpackers that gave the neighborhood its name, Mr. Krueger said.
“It's an opportunity to re-create and move some of these users over,” Mr. Krueger said.
The venture already has fielded “four or five” proposals from tenants, but the facility could be built this year as a so-called “spec” development, or without tenants lined up in advance, Mr. Krueger said. The venture envisions a three-building facility hosting as many as nine tenants, according to marketing materials from commercial real estate brokerage NelsonHill, which represented the Wanxiang venture in its acquisition and is seeking tenants for the project.
“You're going to be hard-pressed to find any vacancy in refrigerated cold storage that's new, that's less than 20 years old,” said Bismarck Brackett, Chairman of Lemont-based Urban Investment Research Corp. “So the wind is probably at (Wanxiang's) back.”
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