Development Update for the Delany Commerce Center

Construction is already well underway on the 218,500-square-foot spec industrial building at the Delany Commerce Center in Waukegan, Illinois. Last month, HSA Commercial was joined by officials from its project partner Great Point Investors LLC and general contractor Premier Design + Build as they celebrated the groundbreaking of the development’s first building at the southeast corner of Delany Road and Blanchard Road. Craig Phillips, Executive Vice President of HSA’s Development Division, guides us through the progress that has been made in the past few weeks of construction since then.

The northwest elevation of the Delany Commerce Center building.

The northwest elevation of the Delany Commerce Center building.

“Within the past month, all of the necessary site utilities and foundations have already been completed, and almost all of the precast concrete panels have been erected to form the building’s shell which will be painted and stained in the coming weeks,” said Phillips. Now, crews from Premier Design + Build are working to construct the steel frame for the roof structure starting at the building’s north end.

Roof structure being constructed at the north end of the facility.

Roof structure being constructed at the north end of the facility.

“Once the roof is fully enclosed, the team from Premier will prep and pour the facility’s floor slab and add the requisite MEP systems for the shell construction,” Craig stated.

A crane lifts concrete panels into place along the eastern wall.

A crane lifts concrete panels into place along the eastern wall.

“With weather permitting, compacting and paving for the parking lot to service the development will begin soon, and we will add the landscaping soon after that,” Craig said. Infrastructure improvements for the project’s two access points from Delany Road are being readied to accommodate the increased truck traffic to the site as well.

View from the southern access drive to the project.

View from the southern access drive to the project.

Based on current construction timelines, delivery is scheduled to occur in late 2013. When completed, the new industrial building–which will be divisible to 25,000-square-foot suites–will offer 30’ clear heights, 28 truck docks, 4 drive-in doors, 300 parking spaces and convenient access to both Highway 41 and Interstate 94. For more updates on the Delany Commerce Center, please visit the project website at www.delanycommercecenter.com.

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Globe Street: HSA Starts Another Spec Development

This article appeared in Globe Street on August 9th, 2013. Click here to see the full article.

Last spring, HSA Commercial, an industrial developer, broke ground on a 180,480-square-foot speculative warehouse in west suburban Woodridge and they just broke ground on yet another, this time at Delany Rd. and Blanchard Rd. in north suburban Waukegan. They partnered with Boston-based Great Point Investors for this 218,500-square-foot building, the first speculative industrial project northern Lake County has seen in a long time.

“Being the first in the ground means a lot,” says Tim Thompson, executive vice president and managing director of the Industrial Services Division at Chicago-based HSA Commercial. “There are other people looking around up there and talking about doing something, but no one else has started.” Leasing activity has been accelerating in the immediate area for some time, especially among local companies hunting for new, class A space. “In that market, a lot of them are growing and right now they have nowhere to go. Obviously, we’re going to get a lot of attention.”

Although “a historically large amount of newly-available second generation space caused Lake County’s vacant [industrial] supply to swell to 7.5-million-square-feet in the second quarter,” up from 6.9-million-square-feet, according to new research by Colliers International, and the overall industrial vacancy rate increased from 9.86% to 10.59%, Thompson says HSA Commercial was not fazed.

“Lake County has always been a fragmented market,” he explains, due to the vast open spaces that separate the several concentrations of industrial buildings. Therefore, most companies in northern Lake County have historically been reluctant to move to the southern region, and vice versa. And even though the county-level vacancy rate increased over the last quarter, the rate among class A industrial space in northern Lake remained less than five percent, Thompson estimates. “So we feel we’re pretty well-positioned.”

The new building will have 30’ clear heights, 28 truck docks, 4 drive-in doors, 300 parking spaces and access to both Highway 41 and Interstate 94. And Thompson says that since most local companies use between 25,000-square-feet and 60,000-square-feet, HSA will retain the flexibility to divide the building down to 25,000-square-foot suites. “I think it’s most likely that this building will get tenants that currently have 30,000-square-feet and need to move up to 40,000-square-feet.” However, “we have a couple of people looking at the building now, and for much larger space,” so they have not set anything in stone.

Michael Caprile, vice chairman, and Steve Roth, executive vice president, of CBRE secured Great Point Investors for the joint venture with HSA. Birmingham-based Regions Bank will provide construction financing for the project, and Premier Design + Build will serve as the general contractor.

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HSA Commercial and Great Point Investors Partnership to Build 218,500 SF Spec Warehouse in Waukegan, Ill.

WaukeganDelany

Jack Shaffer, Chairman and Founder of HSA Commercial, Inc., announced today that the firm has partnered with Boston-based Great Point Investors to develop a 218,500-square-foot speculative warehouse facility at Delany Road and Blanchard Road in north suburban Waukegan, Ill. The partnership broke ground this month on the new industrial building which will be divisible to 25,000-square-foot suites and will offer 30’ clear heights, 28 truck docks, 4 drive-in doors, 300 parking spaces and convenient access to both Highway 41 and Interstate 94.

“We have targeted this property for development for a number of years, and we have watched patiently as the vacancy rates for industrial space have dropped year after year without any new facilities being added to the market,” said Bob Smietana, Vice Chairman and Chief Executive Officer of HSA Commercial. “With the economy continuing to rebound and with the right partner in Great Point, we knew that there was no better time than now for this project.”

“When this opportunity was brought to our attention, we were immediately intrigued by the lack of available industrial product near this strategically valuable Lake County location,” said Joseph Versaggi, Principal of Great Point Investors. “We were even more compelled by the ability to partner with HSA Commercial Real Estate, one of the most accomplished industrial development firms in the Midwest.”

“There’s a great base of firms in the pharmaceutical, fulfillment, packaging, manufacturing, and technology industries in Lake County that don’t currently have the option of locating in the type of premier industrial real estate product that this project will offer,” said Tim Thompson, SIOR, Executive Vice President and Managing Director of the Industrial Services Division at HSA Commercial. “Through our leasing efforts, we hope to provide prospective tenants with a level of quality and flexibility that hasn’t been available in recent years because of the lack of new development.”

Michael Caprile, Vice Chairman, and Steve Roth, Executive Vice President, of CBRE secured Great Point Investors for the joint venture with HSA. Birmingham, Ala.-based Regions Bank is providing construction financing for the project, and Premier Design + Build will serve as the general contractor.

About Great Point Investors
Boston-based Great Point invests in industrial, office, senior housing, and multifamily real estate throughout the United States on behalf of the firm’s institutional clients by employing all-equity, leveraged-equity, joint-venture, and participating-debt structures while pursuing both core and value-added opportunities. With fully discretionary capital, Great Point is able to quickly source and close transactions.

Posted in Development