May June 2022 Chicago Industrial Properties by RE Journals

CRE MARKETPLACE (pg.10): BROKERAGE FIRMS CONSTRUCTION COMPANIES/ GENERAL CONTRACTORS FINANCE & INVESTMENT FIRMS

VOL.32 NO.3

THE LEADING NEWS SOURCE FOR INDUSTRIAL REAL ESTATE PROFESSIONALS & USERS

MAY/JUNE 2022

The race for space continues, according to Chicago Industrial Properties’ 2022 Industrial Summit

Developer/Construction Challenges: Chris Moore, Director of Project Development, FCL Builders; Melissa Roman, VP Dev Officer, ProLogis; Patrick Clay, Dir Bus Dev, ARCO/Murray; Alba Colavitti, Senior Design Associate, CRG; Andrew Maletich, Principal, Cawley Chicago. By Mia Goulart, CIP Staff Writer

hicago's record numbers bode well for many in the industry, but navigating the numerous economic headwinds and resulting competitive climate has proven to be quite the challenge. Demand for space is far outweighing supply, and this can only mean one thing:

The Space Race is on, and this one looks a little different than the last. That was just one takeaway from Chicago’s 2022 Industrial Event, hosted by Chicago Industrial Properties.

SUMMIT (continued on page 6)

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CHICAGO, IL PERMIT NO. 3223

Five Ways for CRE Brokers to Improve Their Technology Game By Sam Badger, SIOR President, SIOR Chicago Chapter

rom the time the telephone landline was invented in the late-nineteenth century, it took 75 years to reach 15 million users. Mobile phones took 12 years to reach the same milestone. And the hugely popular augmented reality mobile game Pokémon Go? 19 days.

TECHNOLOGY (continued on page 9)

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M A Y /JUN E 2022 C HIC A GO INDUSTRI A L P R OP E R T I E S

CONTENTS

PUBLISHER Mark Menzies menzies@rejournals.com 708.622.0074 STAFF WRITER Mia Goulart mia.goulart@rejournals.com VICE PRESIDENT OF SALES & MW CONFERENCE SERIES MANAGER Ernie Abood eabood@rejournals.com VICE PRESIDENT OF SALES Marianne Grierson mgrierson@rejournals.com

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Chicago Industrial Properties® (ISSN 1546-377X) is published bi-monthly for $59 per year by Real Estate Publishing Corporation, 1010 Lake St Suite 210, Oak Park, IL 60301. Contact the subscription department at 312.933.8559 to subscribe. © 2022 by Real Estate Publishing Corporation. All rights reserved. No part of this publication can be reproduced or transmitted in any form or by any means, electronic or mechanical including photocopying, recording or by any information storage or retrieval system.

The race for space continues, according to Chicago Industrial Properties’ 2022 Industrial Summit Chicago's record numbers

bode well for many in the industry, but navigating the numerous economic headwinds and resulting competitive climate has proven to be quite the challenge.

Five Ways for CRE Brokers to Improve Their Technology Game Now is an extraordinary time as technological innovation is revolutionizing our personal and professional lives at breakneck speed.

Investor activity rises for REITs in Chicago Industrial Real Estate Investment Trusts (REITs) are in high demand in the Midwest. This is true of Chicago especially, partly because of its large population and central location.

CRE MARKETPLACE BROKERAGE FIRMS CONSTRUCTION COMPANIES/ GENERAL CONTRACTORS FINANCE & INVESTMENT FIRMS

Consumption’s a constant, therefore so is cold storage. But there are considerable challenges

COVID-19 changed everything about our day-to-day lives. Even our food habits.

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CHICAGO INDUSTRIAL PROPERTIES MAY/JUNE 2022

Consumption’s a constant, therefore so is cold storage. But there are considerable challenges By Mia Goulart, CIP Staff Writer

OVID-19 changed everything about our day-to-day lives. Even our food habits.

Time is perhaps the biggest roadblock. Large-scale space is difficult to build We couldn’t dine in restaurants. Groquickly, especially cery trips were minimized. But we factoring in today’s still had to eat, and we, therefore, resupply chain issues sponded to the crisis the same way we and inflated prices. always have. We adapted. Since we Mechanical systems couldn’t go to the food, we leaned on must also be reviewed e-commerce to bring it to us. and approved prior to beginning construcThis, in turn, changed how producers tion. They’re more reacted to production, which also heavily scrutinized, caused a shift in supply and delivery. and Geoffrey KasRestaurants had to get creative. Kitch- Kelly Disser selman, Senior Vice Geoffrey Kasselman ens were not equipped to produce the President/Partner, sudden influx of carry-out, and busiWorkplace Strategy nesses were left with no choice but to at CRG, expanded on handle the heightened demand by storing but the recent increases and new levels the various challenges. mass-produced food — but they needed create even more uncertainty. Demand additional cold space to do so. Producers, is strong and clients who occupy these “Buildings need chemical fire protection in the same way, were bulk purchasing buildings continue to have record years, systems, rather than ones that are waout of fear of shortages. but heightened costs and supply chain ter-based,” Kasselman said. “A cooler/ concerns leave many questions unan- freezer fire cannot be extinguished with Demand far outweighed supply, though, swered. While it is very early (in regard water. The fire department nearest the faand the equation looks the same today. to this change) we are starting to hear that cility must have chemical training, which Investment gold due to their resulting high some line item costs may start to come is not the case for all of them. The options price point, but uncertainty remains for down, even if slightly, given some large at this point are a) find a different site or other players involved. projects which have recently been put on b) pay to train the local fire department so hold. Interest rate increases cause the cost they can provide service in the unlikely There’s a lot to consider when building of nearly everything to be more expensive event it’s needed.” these facilities. Its higher barriers to entry – directly or indirectly, and those changes make it a unique sector within CRE. in valuations in the equity markets now as Employee shortages are yet another issue well. Put all that together, and there are across the board. Facilities are having Location is especially important, as they more questions regarding the supply chain trouble finding people willing to work must be built near population-dense met- and broader economy now, in fact, than in the cold, ammoniacal environment. ros with relative proximity to their end there were six months ago.” Because of this, newer builds are utilizing consumer. It’s too expensive to transport automation, alleviating the need for a large food long distances, and though the cost Buildings also require a near substation or quantity of workers, and resulting in more increases are starting to plateau, it’s not data-center grade power source to oper- space for product. People are looking for likely that they will reach normal levels ate, reducing options further. creative solutions. Robots are doing the any time soon, according to Kelly Disser, picking, much like a vending machine, Executive Vice President, Industrial Ser- Cold storage must compete with other cor- but this is few and far between considervices at NAI Hiffman. ners of the market for these appropriately ing the lack of development caused by the located sites because of the general lack current competition for building space. “It remains to be seen, whether construc- in available space. Even if there’s space to tion pricing will come back down,” Disser be acquired, building limitations make it a Sometimes these factors align just right, all explained. “It is always hard to predict – challenge to follow through. this said.

More buildings are being developed compared to past numbers. Major food retailers like Amazon/Whole Foods, Walmart, Target, and Meijer need sizeable amounts of space. But existing space is often outdated, energy efficient, and running on no longer legal, carbon-unfriendly coolant. The problem, again, is one of time. Does one choose an outdated building that’s ready for move-in? Or wait a year and a half for a new, and significantly more expensive, build-to-suit with automation and climate-friendly systems? These are hard choices for companies to make. And whatever their choice, it will have an impact on the market. The Wall Street Journal, for example, announced that Bain Capital and Barber Partners LLC have formed a joint venture “aimed at spending $500 million to build 10 to 15 refrigerated warehouses across the U.S. over the next three to five years… with the average facility spanning roughly 300,000 square feet.” This is expected to have notable effects on the market, as the U.S. is not accustomed to so much added supply. Everything is interconnected, and many variables are largely unsolved. There’s insatiable demand and tight supply, and both NAI Hiffman and CRG agreed that dynamic is not changing. CBRE found that 39% of investors seeking alternative investment sectors said they were interested in cold storage in 2022, up from 7% in 2019, according to WSJ. E-commerce is expected to continue to fuel the growth in cold storage, despite its many trials, and though consumer spending is starting to revert to pre-pandemic levels, spending habits are ever evolving.

CHICAGO INDUSTRIAL PROPERTIES MAY/JUNE 2022

SUMMIT (continued from page 1)

Panel I: State of Chicagoland Industrial Market Adam Moore, First Industrial Realty Trust; John Joyce, SVN Chicago Commercial; Josh Bauer, Kirkland & Ellis LLP; and Kelly Disser, NAI Hiffman, discussed these factors specific to Chicagoland. Market Assessment What goes up, must come down. Robust growth is being seen across Chicago, but 2022 has come with its own set of concerns. Inflation, rising interest rates, geopolitical uncertainty and political disfunction have all been seen before, however not at the same time. Interest rates are predicted to increase yet again. Rising rates impact underwriting development deals as capitalization rates begin to change. And as exemplified over the last few months, these rates fluctuate consistently depending on product type, term, and buyer. Buyers who need debt and leverage must solve for a return higher than their cost of capital, and developers must solve for a higher yield. Land and construction process are high, leaving companies to navigate how best to bridge the gap. The only moveable factor is the increasing of rent, which is a concern for occupiers. When interest rates reach 6-7%, Joyce said it is better to lease than to own, considering the effect these rates have on monthly payments. Smaller investment deals are also affected by this. Rising rates force the pushing of yields lower with capitalization rates and competition, causing deals to become too thin. Lenders are therefore looking at stress testing to see if the deals work, according to NAI Hiffman. Other looming challenges include inflation and supply chain disruptions, both impacting costs. Construction materials cause some of the more significant impacts on pricing relative to or because of supply chain issues. Steel prices increased two and a half times from January to September of 2021, which has had a major effect on project development. Spec has been about 60% of development, leaving build-to-suits around 40%. The gap is expected to widen even further in the coming months. These increases are tapering slightly due to softened demand, but because of the strong backfill of demand for continued development, this might not have much of an impact. Lease Negotiations: Trends & Tenants Companies are seeing massive rent growth, especially for REITs. Duke Realty expects to see some normalcy around 3.5%. Buyers are also preferring short-term leases over longterm to bump rent prices. It’s competitive. Tenants who are now coming out of long-term leases are seeing rates

John Nyhan, Partner, O’Keefe Lyons & Hynes; Dan Fogarty, Chief Inv Officer/ Principal, Stotan Industrial; Brock Herr, VP & Counsel, Business Development, Indiana Economic Dev Corp; Craig Dannegger, Sr VP, Clarius Partners; Alfredo Gutierrez, Owner & Founder, SparrowHawk that have increased 25-30% in the last two years. There are new, large blocks of product on the market, but extremely limited inventory, especially near O’Hare. The I-55 Corridor, for example, is experiencing a lessthan-2% vacancy rate. Companies brave enough to roll the dice on spec builds are having success because of users need for space. Businesses are threatened by losing market share or closing completely if they don’t make the right decisions. Current economic conditions are trusted to continue to fuel the boom in Chicagoland. Looming threats aren’t stopping anyone from continuing to gamble despite the risks. In fact, NAI Hiffman said that many don’t have a choice. Users are relied on by their customers to grow and fulfill new contracts, only adding to the continued demand for space. Forecast Chicago has received its fair share of bad press in recent years, but its industrial market has remained one of the strongest across the U.S. It’s over-land transportation network, intermodal system, and air freight business, to name a few factors, make it especially attractive to those both inside and outside the city. Twelve million people inhabit Chicagoland, and it will always be in favor due to its central location. The markets that don’t have any buildings or vacancy are the places where you can push rents. Duke Realty, for instance, is building in Cicero and Geneva. Duke can push rents higher in Cicero due to the lack of competition. Infill markets will continue to see rent growth as long as demand stays high. Demand will start to plateau at some point, though, and a problem will arise when one underwrites a deal at rents they can’t hit. Companies will continue to aggressively chase until that happens, while remaining cautious and methodical in non-infill locations.

SVN Chicago Commercial highlighted the growth of I-65, I-90 West, Hoffman Estates and Shamburg, all relatively new to the action. Panel II: Industrial Development, Leasing Trends and Construction Challenges in Today’s Market

Kelly Disser, Exec VP, NAI Hiffman; Josh Bauer, VP Leasing & Development, DUKE Realty; Moderator, Josh Hanna, Partner, Kirkland & Ellis; John Joyce, Managing Director, SVN Chicago Commercial. To combat the issues of long lead times and supply chain issues, Chris Moore and Patrick Clay highlighted the importance of force majeure clauses within contracts. When you’re dealing with unpredictable commodity fluctuations, buying and designing early is the only way to beat the game.

Chicago Industrial Properties heard from Alba Colavitti, CRG; Andrew Maletich, Cawley Chicago; Chris Moore, FCL Builders; Melissa Roman, Prologis; and Patrick Clay, ARCO/Murray, regarding the impact of inflationary prices and emerging technology.

Clay believes what may happen is a continued receding from economic centers, like Chicago’s CBD, to places outside of that sphere. Only 4% of the U.S. is industrialized, which is a lot of land available for construction opportunities, and things are not expected to slow down.

Cost Increases and Projections

Technology and Other Trends

Steel was the crisis of last year. Today’s concerns, moreover, lie with tilt and concrete. Chicagoland has seen an increase of around $6/square foot, and there are many contributing factors. There are few suppliers within the region, for one. Lead time for precast is close to a year and a half, and it’s not economically feasible to have precast shipped from elsewhere in the U.S, especially after considering recent fuel surcharges.

Prologis is considering smart technology to allow for easier self-management of its buildings. There’s also a push toward sustainability and net zero — ARCO/Murray is utilizing solar panels and solar farming on top of assets. This will eventually become standard, and experts are exploring new ways to incorporate environmentally friendly elements into their projects. Tenants have been especially interested reducing their carbon footprint. These changes aren’t easy, though, in today’s constrained market. They require much more involvement, especially when reworking an existing building.

Roofing prices are another concern. Escalations are being carried at 15%, and some buildings are having to make do with temporary roofs until the materials are available. Melissa Roman received pricing updates as recent as a few weeks ago that confirmed prices would rise again on June 1. It’s an issue of supply and demand, largely due to inventory and labor constraints, and both factors have the potential to impact the market long term. Alba Colavitti placed a big emphasis on the need for campaigns to attract more trade employees to lessen the shortage. Demand type has also widened the gap between supply and demand. Roofs are a good example. Many made the switch to TPO last year due to steel prices, which caused a shortness in availability of materials.

Multi-level builds are yet another trend being seen across the U.S. And in Chicago? It’s coming. The asset class is flexible, and the mixed-use configurations are endless. The multi-level shift makes sense for monetization of land, but Clay confirmed it will have to fall in line with the economics of the deal. Looking to the future, Chicago is showing no signs of cooling off. The area has shown incredible growth — Q1 of 2022 has only been beaten by Q4 of 2021. Recessions are inevitable due to the cyclical nature of the industry, but experts are poised to handle whatever comes their way due to today’s climate and ceaseless demand for e-commerce and related industries.

CHICAGO INDUSTRIAL PROPERTIES MAY/JUNE 2022

Investor activity rises for REITs in Chicago By Mia Goulart, CIP Staff Writer

ndustrial Real Estate Investment Trusts (REITs) are in high demand in the Midwest. This is true of Chicago especially, partly because of its large population and central location.

Chicago, and its location alone makes it a viable location for any developer or investor to place capital. Just in the last quarter, CBRE indicated that there was about 94 million square feet absorbed throughout the country, and of that, 10.5 million was absorbed by Chicago alone. We're experiencing good rental growth in our properties in Chicago, and I think that's going to continue. The demand is certainly there.

We interviewed Mark Crawford, Duke Realty Senior Vice President, Head of Acquisitions; Pen White, Plymouth Industrial REIT President, Chief Investment Officer & Co-Founder; and Adam Moore, First Industrial Realty Trust Senior Regional Director regarding REIT activity in Chicago. Chicago Industrial Properties: Can you explain what’s going on with REITs in the industrial sector? Crawford: Fundamentals continue to be remarkably strong for industrial assets. Duke Realty set company records for occupancy and rent growth in 2021. Recently, inflation, rising interest rates and geopolitical risks have caused investors to question valuations. It’s too early to tell if this is a real challenge or a short-term reaction similar to early 2020. White: Investment continues to increase and looks sustainable for the near future. There’s still a healthy balance between new supply and demand. Demand is absorbing the space on the market, causing rates to increase. That demand is based largely on e-commerce — which is still a strong factor throughout the economy — along with the repurposing of inventory. More Fortune 1000s are rebuilding inventories or onshoring more product in the U.S., ensuring that they have the product to satisfy customer’s needs. Just-in-time distribution looks more like just-in-case, which is why there’s stockpiling of product across the country. It’s preferrable to waiting to get that product from Asia, Europe, or Mexico and risking supply chain issues. Moore: The industrial real estate sector as a whole continues to enjoy excellent fundamentals. REITs like us at First Industrial Realty Trust are delivering strong operating results and creating value for shareholders through profitable investments in development of new industrial facilities. Our portfolio of properties located in the top U.S. markets, was 98% occupied at the end of the first quarter, and we are delivering strong rent growth. Given a national vacancy rate of just 3%, we have expanded our development pipeline to meet tenant demand, with a focus on coastal markets and select submarkets that are supply-constrained. As of April 20th, that pipeline totaled 6.3 million square feet with a projected total investment of $751 million, our largest since we re-launched our development program in 2011. Chicago Industrial Properties: What’s happening with investment activity, especially as the U.S. continues to recover from COVID-19? Crawford: Investment demand for logistics properties continues to be strong. Rents continue to grow rapidly making the sector

Mark Crawford

Adam Moore

attractive relative to other investment opportunities. There are several new entrants into the sector looking for opportunities and pushing pricing higher, which is great for our existing portfolio but makes acquisitions more financially challenging. COVID-19 restrictions and shelter-in-place orders drove increased e-commerce retail activity and forced companies to reconfigure their supply chains contributing to the industrial sector’s improved performance. As we reach the endemic stage of COVID-19, one of the biggest demand drivers for industrial properties is an increase in the level of safety stock that companies are carrying to offset the volatility in the global supply chains. White: Activity is still robust. There's a lot of capital (both domestic and international) and there’s pressure from all capital sources to invest in North America. Industrial is an attractive asset class right now, but because there is a lot of capital to be invested in assets from coast to coast, prices continue to increase across the board. We’ve experienced this over the course of the last few years. Moore: Demand for industrial properties in the investor marketplace continues to be very strong, as it has been one of the top performing real estate sectors for some time. Given the exceptional rent growth our sector is enjoying, investors are attracted to the opportunity to drive incremental cash flow from increasing rents vs. expiring rates. Incremental demand has been meeting or exceeding demand for a number of years, driven by e-commerce and supply chain investments across a broad range of industries. This breadth of demand gives many investors confidence that they can re-lease their building in the event of a vacancy. In addition, development is constrained in many markets due to the lack of available entitled land. While rising interest rates might impact the investment decisions of certain levered buyers, the overall buyer pool remains very deep for single assets or portfolios. Chicago Industrial Properties: What kind of industrial properties make for the best investments and why? Crawford: The best investments are a function of location, quality and price. A high-quality building in a poor location and at a high price is not as attractive as a lower quality building in a good location at a reasonable price. Understanding the markets and pricing across those markets has allowed us to find great investment opportunities nationally. We like the

Pendleton P. White risk adjusted returns in development. We have extensive experience and success in development, and we are achieving premium yields. When acquiring existing properties, we are looking for shorter term leases so that we can roll them to market. Also, we look at properties that we can buy close to land value, giving us more flexibility as the leases expire – we can lease again or redevelop the property. White: Industrial subsectors are in high demand right now, and a lot depends on the market or submarket where the assets lie. There’s a high demand for million-square-foot distribution and fulfillment centers on the West Coast. Other markets like Jacksonville or Memphis are more conducive to flex or multi-use logistics. What gets the headlines are million-square-foot warehouse or fulfillment centers that are occupied by large companies like Amazon, Target or any 3PLs that set the space on behalf of their clients. Moore: We are focused on driving long-term cash flow from our investments. Our philosophy is to focus on high quality, well-located properties in supply-constrained markets and submarkets that can serve the needs of a wide range of customers for industrial space. When building or buying a property, we want to ensure they have key features like excess truck, trailer and car parking, as well as wide turning radiuses. Efficient highway access and a talented labor pool are also considerations. These features will help our buildings perform throughout the business cycle. With much of our investment being done through development, our new state-of-the-art buildings require limited capital expenditures for many years, contributing to our overall cash flow growth. Chicago Industrial Properties: What makes Chicagoland an attractive place for investors? Crawford: Chicagoland is one of the largest industrial markets in the country. It has the third largest population in the U.S., and approximately 270 tons of goods moves in and out the market annually. Recently it has seen significant net absorption pushing vacancies lower and rents higher. Chicago’s market size, distribution infrastructure and status as the largest city in the Midwest make it an important market for institutional investors. White: Chicago is the largest market in the U.S. at 1.3 billion square feet. It's in the epicenter of the country. All railroads run through

Moore: Investment drivers for the Chicago market are its position as a significant consumption zone and critical transportation hub for the nation. With six Class I railroads serving the area and O’Hare as the fourth busiest air cargo hub in the nation, many goods go to or through Chicago. The size and depth of the investment market for properties in Chicago drives strong demand from institutional and local investors, making it a very liquid and efficient market. Chicago Industrial Properties: Where in Chicago have you invested? Where in Midwest? Crawford: In Chicago, Duke Realty is focused on infill opportunities. We’ve found that many of our clients want to be near the millions of consumers they serve so we have scoured areas like Bedford Park, Cicero and around O’Hare for amazing sites. At the same time, we have continued greenfield developments in both the I-55 and 88 Corridors where demand continues to be strong. Duke Realty is also very active on the development front in Indianapolis where we have three speculative projects underway and in Columbus, Ohio. Additionally, we have robust, well-established portfolios of existing properties in Minneapolis and Cincinnati. White: Chicago is our largest market, but we're in other markets in the Midwest. We're also in markets in Ohio, like Cincinnati and Columbus. The industrial marketplace is as robust and has some solid tailwinds behind it right now. I expect it to continue to grow, and we’re bullish on the on the overall asset class and the markets that we're in. Moore: We currently have a new 451,000 square-foot development underway in the Kenosha market. This will be our third building in our First Park 94 project and our total investment in this building will be $38 million. Completion is slated for Q4 of this year and the facility will be a perfect home for tenants serving the Chicago and Milwaukee consumption bases and the greater Midwest, with easy access to I-94. We can also accommodate up to 2.6 million square feet of future development at the park, either through build-to-suits or future speculative projects. We are also excited about two buildings we have underway in Nashville. The first is a 692,000 square-foot build-to-suit for Chewy, the online pet food and supply leader. The second is a 500,000 square-foot project in lease-up that will be ready for occupancy by Q3 of 2022.

M A Y /JUN E 2022 C HIC A GO INDUSTRI A L P R OP E R T I E S

capital, automate building operations, and drive digital marketing efforts. VTS is particularly well adopted with more than 45,000 CRE users.

TECHNOLOGY (continued from page 1)

Now is an extraordinary time as technological innovation is revolutionizing our personal and professional lives at breakneck speed. The commercial real estate industry’s bad rap as a slow adopter is 100% accurate, and those of us relying on a handshake and our last deal to build our future book of business will be left in the dust if we don’t evolve with technology. According the Center for Real Estate Technology & Innovation’s Real Estate Tech Venture Funding Report, private investment in proptech hit $32 billion in 2021, a 28% increase from the year prior. There are currently 8,000 startups targeting commercial real estate with some level of VC funding. Proptech is creating more efficiency and greater transparency between a broker and client, altering the corresponding expectation in service delivery. Instead of feeling like the technology is threatening long-standing relationships, CRE brokers need to embrace the opportunity to be a better, more informed advisor. Recently the president of SIOR Global, Robert Thornburgh, SIOR, spoke to a

4. Subscribe to podcasts, newsletters, and blogs. There is no end to our industry’s desire to share tech-related opinions and trends. Take advantage of it! MIT’s CRE tech blog is interesting, digestible, and relatable to everything we do in CRE. America’s Commercial Real Estate Show is a weekly podcast designed to keep CRE professionals in the know. Connecting with LinkedIn groups specific to CRE tech will give you a steady stream of insights. Sam Badger, SIOR

group of SIOR Chicago Chapter members and shared his insights on how brokers can embrace this more digital future. Here are five ways he proposed to get started: 5. Know what’s out there. If you have no comfort level with proptech, start with familiarizing yourself with companies like Cherre, Juniper Square and VTS. These powerful digital platforms can do things like manage and centralize leasing reporting, raise investment

3. Seek youthful opinions. If everyone in your organization or project team or service line is over 40 and you don’t have connections to Millennials and Gen Z workers, your competitive advantage is eroding. They have new ideas, challenge things, and don’t have long-term employee baggage. Actively seek their opinions and knowledge and integrate those ideas into your business. 2. Attend tech conferences. This is a largely overlooked opportunity to not only learn about tech, but to be where your clients are. Conferences like MIPIM can totally transform your outlook, and

with just three or four key takeaways you’ll be able to communicate with your client on a much higher level. 1. Find time for professional development. We are all busy and consumed with client demands, but once you’ve found the resources that you find most helpful, make sure you carve out consistent time each week to dedicate to them. Take those learnings and develop an annual business plan for yourself that includes technology as its North Star. A piece of technology is not going to replace a broker. However, what’s here to stay are expectations about a broker’s level of sophistication and how services are delivered. Local market knowledge is critical, but to compete your personal story needs to include tech in a meaningful way. Brokers that view tech as a fundamental threat have the most to be worried about.

CHICAGO INDUSTRIAL PROPERTIES MAY/JUNE 2022

CIP MARKETPLACE BROKERAGE FIRMS

CONSTRUCTION COMPANIES/GENERAL CONTRACTORS

FRIEDMAN REAL ESTATE

ALSTON CONSTRUCTION COMPANY

34975 W. Twelve Mile Road Farmington Hills, MI 48331 P: 888.848.1671 Website: friedmanrealestate.com Key Contacts: David B. Friedman, President/CEO; Gary Goodman, Sr. Managing Director-Brokerage Services Services Provided: Friedman offers a full range of real estate services including commercial and multifamily property and asset management, tenant and landlord representation, investment and loan sale advisory, space planning, design and construction and a unique platform of lenderfocused bankruptcy, receivership and distressed asset services. All services are provided inhouse, though a single point of contact, which guarantees that clients receive the most timely and efficient service available in the marketplace. Company Profile: Founded in 1987, Friedman Real Estate is one of the largest privately held commercial real estate organizations in the nation; currently managing over 15M SF of commercial space and more than 15,000 apartment homes located throughout the country. Friedman’s commercial brokerage team has over 800 current listings with $20 billion in closed transactions. Notable Transactions/Clients: • Hovis Light Industry Park – Dekalb • Poplar Creek Office Plaza – Hoffman Estates • 801 North Route 83 – Bensenville • Crystal lake Office – Crystal Lake • Broadway Village – Pekin • National Railway Equipment – Dixmoor • Daycare Building – Bolingbrook • Freeport Shopko – Freeport

MARCUS & MILLICHAP

333 West Wacker Drive, Suite 200 Chicago, IL 60606 P: 312.327.5400 Website: marcusmillichap.com Key Contact: Michael Glass, Senior Vice President/ Midwest Division Manager, michael.glass@marcusmillichap.com. Services Provided: Marcus & Millichap is a complete brokerage offering investment sales, financing, research and advisory services. Investment specialists represent investors of apartments, multi-tenant retail, single-tenant retail, office, industrial, affordable housing, student housing, seniors housing, manufactured housing, medical office, self-storage, hospitality, golf and resorts, and land. Company Profile: Marcus & Millichap is a leading firm specializing in commercial real estate sales, financing, research and advisory services. The firm has the largest team of investment specialists in the industry, dedicated to meeting the diverse needs of private and major/ institutional investors throughout the United States and Canada.

NAI HIFFMAN

One Oakbrook Terrace, Suite 400 Oakbrook Terrace, IL 60181 P: 630.932.1234 | F: 630.932.7258 Website: hiffman.com Key Contacts: Dave Petersen, CEO, dpetersen@hiffman.com; Michael Flynn, COO, mflynn@hiffman.com Company Profile: NAI Hiffman is the largest independent real estate services firm in the Midwest, providing leasing, property management, tenant representation, capital markets, project services, research, and marketing services for institutional and private owners and occupiers of commercial real estate. NAI Hiffman currently leases and manages over 100.5 million square feet, encompassing more than 800 properties in 28 states. With more than 200 employees, NAI Hiffman is the Chicago-area representative for NAI Global, the world’s largest managed network of real estate service providers, with more than 6,000 local market professionals managing more than 1.15 billion square feet of property. NAI Global has more than 375 offices strategically located throughout North America, Latin America, Europe and Asia Pacific. For more information, please visit hiffman.com.

PW COMMERCIAL REAL ESTATE

8725 W. Higgins Road, Ste. 800 Chicago, IL 60631 P: 773.714.9300 | F: 773.714.8253 Website: painewetzel.com Key Contacts: Jerry Sullivan, Principal, sullivan@painewetzel.com; Ed Wabick, Principal, ewabick@painewetzel.com Services Provided: Real Estate Strategy with dependable results in Brokerage, Consulting, TenantAdvisory, Corporate Services, Property Management, Development, Strategic Planning, Research and Construction Management. Company Profile: PW has been a leader in industrial, office and investment real estate since 1975. We pride ourselves on offering unparalleled brokerage services and superior market expertise to attain your real estate and business goals.

1900 Butterfield Road, Suite 1020 Downers Grove, IL 60515 P: 630.437.5810 Website: alstonco.com Key Contact: Greg Kolinski, Director of Business Development, gkolinski@alstonco.com Services Provided: Alston offers a diverse background of design-build experience, general contracting and construction management of industrial, commercial, healthcare, retail, and municipal projects. Company Profile: Alston Construction's success begins and ends with our approach to planning, scheduling, and choosing the right team. We have been adhering to an open and collaborative approach since our founding more than 35 years ago. Notable/Recent Projects: 1.5M SF Distribution Center for General Mills. John Pennycuff Memorial Apartments 7-story, 88-units. Call Center with open offices with full-service café, gymnasium, and fitness center for Medline Industries. Freestanding Medical Office Building with 33 exam rooms, rehabilitation gym, and support service/diagnostic space for CHI Health and NexCore Group and a 1.4 million SF build-to-suit distribution center for Medline Industries in Grayslake.

KEELEY CONSTRUCTION

245 E Sidney Court Villa Park, IL 60181 P: 630.833.8600 | F: 630.833.9595 Website: keeley.com Key Contacts: Bill Keeley, President, bill@keeley.com Sean Keeley, Managing Director, sean@keeley.com Services Provided: Pre-construction, General Contracting, Renovation Services, Green Building, Design Build, and Construction Management Company Profile: As a design/build general contractor, Keeley Construction specializes in all types of new building construction including commercial, industrial, and cold storage/food service facilities as well as redevelopment and all aspects of renovation and tenant improvements of existing structures. Notable/Recently Completed Projects: Fountain Crossing 250k SF Spec – Hoffman Estates, IL; Tangent Technologies – Montgomery, IL – 925,000 SF Redevelopment of former Caterpillar Plant; Pure’s Food Bakehouse #3 – Bedford Park, IL – 65k SF of Institutional Bakery

LAMP INCORPORATED

460 North Grove Ave. Elgin, IL 60120 P: 847.741.7220 | F: 847.741.9677 Website: lampinc.net Key Contact: Ian Lamp, President, ilamp@lampinc.net Services Provided: Design/Build, General Construction, and Construction Management services for additions, build outs, renovations, and new facilities for office, industrial, logistic, technology, and commercial buildings. Company Profile: Lamp Incorporated has been providing professional construction services for over 80 years. Our commitment of exemplary service to our clients creates projects that are completed early and with exceptional value. Notable/Recent Projects: Mitutoyo America Corporation North American Headquarters, Aurora, IL. 96,000 SF warehouse addition; 63,000 SF, three-story office addition, which includes high tech showroom, two story atrium, corporate offices/ conference room, cafeteria, and locker rooms.

MCSHANE CONSTRUCTION COMPANY

9500 West Bryn Mawr Avenue Ste. 200 Rosemont, IL 60018 P: 847.292.4300 | F: 847.292.4310 Website: www.mcshaneconstruction.com Key Contacts: Mat Dougherty, PE, President, mdougherty@mcshane.com Services Provided: McShane Construction Company offers more than 35 years of experience providing design-build, design-assist and general construction services on a national basis. The firm’s diverse expertise includes build-to-suit and speculative warehouse, distribution and manufacturing facilities, as well as multifamily, commercial and institutional developments. Company Profile: Headquartered in Rosemont, Illinois with regional offices in Auburn, Alabama, Irvine, California, Phoenix, Arizona, Madison, Wisconsin and Nashville, Tennessee, McShane Construction Company provides comprehensive construction services on a local, regional and national basis for a wide variety of market segments. The firm is recognized as one of the Chicago area’s most diversified and active contracting organizations with a reputation built on honesty, integrity and dependability. Notable/Recent Projects: Abt Electronics – the construction of a 430,000-square-foot addition to Abt Electronics’ warehouse and showroom facility in Glenview, Illinois, including two three-story office blocks and 407,000 square feet of warehouse space. Industry Center at Melrose Park – the new construction and interior buildouts of three speculative industrial buildings totaling 652,000 square feet in Melrose Park, Illinois.

M A Y /JUN E 2022 C HIC A GO INDUSTRI A L P R OP E R T I E S

MERIDIAN DESIGN BUILD

9550 W. Higgins Road, Suite 400 Rosemont, IL 60018 P: 847.374.9200 | F: 847.374.9222 Website: meridiandb.com Key Contacts: Paul Chuma, President; Howard Green, Executive Vice President Services Provided: Meridian Design Build provides construction and design/ build construction services on a national basis with a primary focus on industrial, office, medical office, retail and food and beverage work. Company Profile: With a team of in-house professional project managers, Meridian has extensive experience coordinating the design and construction of new buildings, tenant improvements, and additions/ renovations from 15,000 square feet to 1,000,000+ square feet. Meridian Design Build has been a Member of the U.S. Green Building Council since 2007. Notable/Recent Projects: Clarius Park Joliet Building #2, Joliet, IL - 906,517 sf speculative industrial facility for Clarius Partners. Commerce Park Chicago Building B, Chicago, IL - 602,545 sf speculative multi-tenant industrial facility for NorthPoint Development. Halsted Delivery Station, Chicago, IL - 112.000 sf package delivery station on a 17-acre redevelopment site for Prologis.

FINANCE & INVESTMENT FIRMS

ASSOCIATED BANK

525 W. Monroe Street, Ste. 2400 Chicago, IL 60661 P: 312.544.4645 Website: associatedbank.com/cre Key Contacts: Gregory Warsek, Group Senior Vice President/Senior Regional Manager, greg.warsek@associatedbank.com Services Provided: Our clients include professional developers of income producing commercial real estate, including multi-family properties, retail, office, self- storage, student housing, industrial, and for sale housing. Company Profile: Commercial Real Estates offices are located in Chicago, Milwaukee, Madison, Green Bay, Cincinnati, Indianapolis, Minneapolis, Detroit, St. Louis, Dallas and Houston. Associated Banc[1]Corp has total assets of $35 billion and is one of the top 50 financial services holding companies in the United States

PEAK CONSTRUCTION CORPORATION

1011 E. Touhy Ave., Ste. 100 Des Plaines, IL 60018 P: 630.737.1500 | F: 630.737.1600 Website: peakconstruction.com Key Contacts: Michael P. Sullivan, Jr., CEO & Founder, msullivan@peakconstruction.com; John Reilly, President, jreilly@peakconstruction.com Services Provided: Peak Construction Corporation offers design/build and construction management services through a strategically developed culture, highly regarded for dynamic problem-solving abilities and a network of alliances that allow Peak to bring in experts and partners from a wide spectrum of fields and roles. Company Profile: Peak Construction Corporation is a privately-held, well-capitalized design/build general contractor. For 25 years Peak has delivered industrial, hospitality, office, healthcare, retail, multi-family and specialty construction projects on-time and on-budget. Notable/Recent Projects: Peak’s recent Midwest projects include Scannell Properties’ DuPage Business Center Phase II in West Chicago, Elgin Distribution Center, and Strongsville Commerce Center in Ohio, NorthPoint Development’s Bristol Building I and Janko Group’s Bristol Business Park, both in Wisconsin, as well as various tenant improvements throughout Chicagoland and Wisconsin.

SUMMIT DESIGN + BUILD, LLC

1036 W. Fulton Market, Suite 500 Chicago, IL 60607 P: 312.229.4630 | F: 312.229.1147 Website: summitdb.com Key Contacts: Adam Miller, President, amiller@summitdb.com; Deanna Pegoraro, Vice President, dpegoraro@summitdb.com: Larry Blouin, Vice President, lblouin@summitdb.com Services Provided: Summit Design + Build, LLC is a provider of full service general contracting, construction management and design/ build construction services for the commercial, industrial, multifamily residential, office/tenant interiors, hospitality and institutional markets. Company Profile: Located in Chicago’s Fulton Market and with regional offices in Tampa, FL and Austin, TX, Summit Design + Build has been involved in the design and construction of over 330 buildings and spaces totaling more than 7 million square feet over the firm’s 17 year history. Notable/Recently Completed Projects: 1400 W Monroe (Luxury Multifamily Residential), 113 E Oak (Ground-up Retail), Open Kitchens (Industrial), Glen Oak Country Club (Recreational) , 448 N LaSalle – WeWork (Co-working office), Elmhurst Hall (Restaurant) and La Galera Produce (Industrial).

VICTOR CONSTRUCTION

BERKADIA

521 Fifth Avenue, 20th Floor New York, NY 10175 Website: berkadia.com Key Contacts: Justin Wheeler, CEO, 646.600.7815 Ernest Katai, EVP, Head of Production, 248.208.3471 Hilary Provinse, EVP, Head of Mortgage Banking, 301-202-3580 Keith Misner, EVP, Head of Investment Sales, 301-202-3568 Services Provided: Full service, nationwide platform of mortgage banking, investment sales and servicing for all commercial property types including multifamily, retail, office, and industrial as well as specialties of affordable housing, seniors housing and healthcare, student housing, hotels & hospitality, land services, and manufactured housing communities. Company Profile: Berkadia, a joint venture of Berkshire Hathaway and Jefferies Financial Group, is a leader in the commercial real estate industry, offering a robust suite of services to our multifamily and commercial property clients. Powered by deep relationships and industry-changing technology, our people sell, finance, and service commercial real estate, providing support for the entire life cycle of our clients’ assets. Our unique ownership structure allows us to put the client’s interests first and creates a marketplace that delivers a superior experience.

CENTERPOINT PROPERTIES

1808 Swift Drive Oak Brook, IL 60523 P: 630.586.8000 Website: centerpoint.com Key Contacts: Bob Chapman, Chief Executive Officer, bchapman@centerpoint.com; Jim Clewlow, Chief Investments Officer, jclewlow@centerpoint.com Services Provided: CenterPoint Properties is an innovator in the investment, development and management of industrial real estate and multimodal transportation infrastructure. CenterPoint acquires, develops, redevelops, manages, leases and sells state-of-the-art warehouse, distribution and manufacturing facilities near major transportation nodes. Our experts focus on rail and port-proximate distribution infrastructure assets. Company Profile: CenterPoint Properties continuously reimagines what’s possible by creating ingenious solutions to the most complex industrial property, logistics and supply chain problems. With an agile team, substantial access to capital and industry-leading expertise, we provide our customers with a competitive edge and ensure their success — no matter how great the challenge.

MARQUETTE BANK

2000 W ATT Center Dr., Suite East C219 Hoffman Estates, IL 60192 P: 847.392.6900 Website: victorconstruction.com Key Contact: Zak Schuttler, President, ZakS@victorconstruction.com Services Provided: Victor Construction Co., Inc. manages projects from ground-up site developments to interior build-outs, specializing in retail, industrial, and commercial markets. Company Profile: Victor Construction Co., Inc. remains a family-owned and operated General Contractor. Having been in business since 1954, our firm has extensive experience managing every aspect of interior construction for the corporate, manufacturing, industrial, and retail sectors. Notable/Recent Projects: Peppa Pig World of Play - 15k SF Childrens' amusement center inside Woodfield Mall (former Rainforest Cafe space).

10000 W. 151st Street Orland Park, IL 60462 P: 708-364-9135 Website: emarquettebank.com Key Contact: Mark Wojack, First Vice President, mwojack@emarquettebank.com Services Provided: Full line of Commercial, Business and Real Estate loans customized to your individual needs including: commercial and residential construction loans, commercial mortgages, equipment loans and working capital lines of credit. Company Profile: Marquette Bank started in Chicagoland in 1945 and is still locally-owned/operated. Expect quick decisions, competitive rates, easy application and personal service. Personal/business banking and lending, home mortgages, land trust services, estate planning, insurance services, wealth management and multifamily lending.

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