By Ryan Ori
A New York investor paid about $85 million for the 1.6 million-square-foot Solo Cup warehouse in south suburban University Park, the largest sale of a single-tenant industrial property in the Chicago area in eight years. An affiliate of W.P. Carey & Co. bought the distribution center at 701 Central Ave., the New York-based real estate investment trust said today. The seller was a venture of Chicago-based investor and investment manager Fulcrum Asset Advisors LLC.
It is the largest sale of a distribution center leased by one tenant in the Chicago area since early 2006, according to New York-based research firm Real Capital Analytics Inc. A three-building Kraft Foods Inc. warehouse in Aurora sold for about $93.9 million in January 2006, according to Real Capital.
“This really underscores the fact that Chicago continues to be one of the best distribution markets in the country,” said broker Erik Foster of Avison Young Inc., who represented the seller. “International and Canadian capital was strongly interested, as well as domestic sources.”
“It supports our investment strategy of establishing stable, long-term cash flow for our investors,” a W.P. Carey spokesman said.
Solo Cup Co., which was acquired for $1 billion in 2012 by Mason, Mich.-based Dart Container Corp., has 10 years remaining on its lease, Mr. Foster said.
The site in University Park, along Interstate 57, is eight miles south of I-80. Other large industrial sales in the suburb in the past two years include a $64.3 million deal for a 1.35 million-square-foot Clorox Co. warehouse at 2400 Dralle Road in 2012 and a $31.9 million sale of a 697,000-square-foot Georgia-Pacific LLC warehouse at 702 Commerce Drive in 2013.
W.P. Carey is an active investor of single-tenant properties with long-term leases, including a $72.3 million sale-leaseback deal for Kraft’s corporate headquarters in Northfield about a year ago.
Chicago-area industrial vacancy was 8.7 percent in the fourth quarter of 2013, the lowest point since the end of 2007, according to Seattle-based Colliers International. Vacancy was down from 9.5 percent a year earlier.