Peerless Signs 308,000-SF Industrial Lease to Consolidate and Expand Suburban Chicago HQ
- Mar 07, 2010
March 8, 2010
By Barbra Murray, Contributing Editor
With rent prices down and landlords doling out concessions, now is a wise time to literally make a move, and Peerless Industries Inc. is doing just that. The Melrose, Ill.-based audio/visual mounting solutions manufacturer will relocate its headquarters to a 307,800-square-foot warehouse facility in Aurora, Ill., under a lease agreement that allows the company to acquire the property after one year.
Developed in 1997 for technology company 3M, the vacant industrial structure at 2300 White Oak Circle sits on a 22-acre parcel within the White Oak Business Park, 35 miles west of Chicago along Illinois’ Interstate 88 Research & Development Corridor. The building encompasses 268,300 square feet of warehouse space, 26,600 square feet of hazardous storage space and 12,900 square feet of office accommodations. The short lease agreement with property developer and owner Northern Builders Inc. will allow Peerless to bring its operations and employees from two sites in Melrose Park and a plant in China under a single roof; a roof that the company will eventually own.
But even before Peerless acquires 2300 White Oak Circle within the designated 12-month period, the manufacturer will enhance its office space with the construction of 22,000 square feet. More expansion is a possibility in the future, as the property can accommodate an additional 180,000 square feet of new manufacturing space.
Peerless’s lease transaction also paves the way for the company to pursue its objective of achieving a more environmentally friendly workplace. The property at 2800 White Oak Circle is already LEED green certified and Peerless plans to take its sustainability initiative to another level with alterations that will facilitate further energy reduction. The area’s struggling workforce population will benefit from the transaction, too, as the closing of the Peerless plant in China, where 30 percent of the company’s products were being produced, will complete Peerless’s goal of bringing all of its manufacturing positions back to the U.S.
Real estate services firm NAI Hiffman represented Peerless in the lease agreement, while Cushman & Wakefield stood in for the landlord. Financial details of the deal have not been disclosed; however, Cushman & Wakefield had been marketing 2300 White Oak Circle for lease at $3.55 per-square foot and for sale “subject to offer.”
Lease or buy, space options are plentiful in the Chicago area, as 2009 took a heavy toll on the industrial market. Approximately 70,000 manufacturing jobs disappeared last year, according to a report by real estate services firm Grubb & Ellis, spurring a rather steep increase in the vacancy rate, which went from 10.2 percent in 2008 to 12.1 percent in 2009. Companies seeking to consolidate, upgrade, or even expand while rents are low and sign-on perks are plentiful, will keep the leasing deals coming–but they won’t provide much relief for the occupancy-challenged market.