Panattoni Set to Launch Giant Suburban Spec

Tuesday, January 12th 2016

CHICAGO, IL – Industrial builders may be picking up the pace when it comes to speculative development in the Chicago region. Panattoni Development Co. has just completed the purchase of a 76.23-acre land parcel on Airport Rd., east of Weber Rd., in suburban Romeoville’s Pinnacle Business Center, and plans to launch one of the area’s largest spec projects in years.

The sale transaction closed in December and the seller was REM Acquisitions LLC. James R. Estus, principal with Colliers International, and Jason West, executive director with Cushman & Wakefield, were involved with the transaction. Estus and West will market the space for lease for Panattoni.

Panattoni plans to construct a 787,200 square foot building on the site, which would be the second-largest spec project of the past five years, and the largest currently planned or under construction.

Developers broke ground on eight projects, three build-to-suit and five speculative, in the third quarter, according to Colliers, and this activity will add 2.6 million square feet to the Chicago area’s industrial inventory base. The largest new development currently underway is a 452,000 square foot speculative facility in North Aurora.

Panattoni officials say they will begin construction in the spring 2016 and complete the project by fall 2016. The distribution facility will feature 36’ clear ceiling height, 70’ speed bays, and abundant auto/trailer parking.

“The facility represents all the modern features that industrial users are seeking,” says Jason Rosenberg, senior development manager at Panattoni. “We are excited about the opportunity to deliver a new spec building of this size to the I-55 market and are confident that it will be fully supported by the demand we are seeing in that key transportation hub.”

“Third quarter leasing volume increased to 1.5 million square feet, a 6.9% increase from the 1.4 million square feet of lease transactions completed in the second quarter,” according to Colliers. And “the heightened tenant demand was driven by larger users. Four transactions over 200,000 square feet were signed in the third quarter, accounting for 1.3 million square feet of the overall leasing volume. The largest transaction was a 490,400 square foot lease completed by The Central American Group at 815 Bluff Rd. in Romeoville.”

Panattoni has a long history with the town of Romeoville. The company has completed 12 buildings there totaling in excess of five million square feet. The buildings, constructed primarily on a speculative basis, are located within the 500-acre Windham Lakes Business Park and the 200-acre Windham Lakes Southwest development. The new project will be Panattoni’s first development in Pinnacle Business Center.