Source: REJournals.com by Paula Widholm
Ionian LLC, a private real estate investment firm, bought a 492,000-square-foot manufacturing building at 501 N. Sacramento Boulevard at auction for $2.05 million.
The receiver, Gregg Szalagi, president of Tailwind Services, took title to the building in April 2009 following the bankruptcy of the property's owner, box fan maker Lakewood Engineering & Manufacturing Co. Larry Goldwasser, vice president in the industrial brokerage group of NAI Hiffman, co-brokered the listing of the property with Hilco Real Estate.
"The buyer bought it as an investment and plans to modify the building as required to make it suitable for users," said Rodger Chenore, executive vice president of Paine Wetzel. He represented the buyer with team members Jeff Girling and Terence Lynch as well as with Paine Wetzel brokers Ed Wabick and William Kerrins.
The 1940s building sits on 11.5 acres and originally served as the corporate headquarters for Kraft General Foods. Four buyers attended the Jan. 28 auction at the Dirksen Federal Building.
"It's an excellent value," Chenore said. "It sold at a very low price per square foot in an area that's experienced some considerable growth and modernization in the last few years."
Recent sales in the area include Greater North Pulaski's purchase of 500 N. Sacramento. A building at 700 N. Sacramento, which now houses an office of Homeland Security, was also recently purchased and provides modern flex and office space. "It's a very successful corridor and is home to several very good companies," Chenore said.
The area is part a Planned Manufacturing District which protects against "undesirable" uses. Users also benefit from being in an Enterprise Zone and an Empowerment Zone, which equates to a variety of incentives such as sales tax abatements on construction materials and state tax credits for hiring within the zone.
The buyer is "in the planning stages and is basically doing an analysis," Chenore said. "He more than likely will divide the space for different tenants." Some target users may be those serving the nearby Fulton Market area as well as downtown customers.
NAI Hiffman's Goldwasser is also representing another 115,000-square-foot building as part of the same bankruptcy at 4400 W. Ohio St.
Regarding the sale of 501 N. Sacramento, Goldwasser commented that it was "a typical stalking horse auction process. We sign up a buyer and once the buyer's contingencies are waived, we see who can beat the deal. The stalking horse bid was $1.1 million, and 30 days before the auction, the buyer increased the bid to $2.05 million."
Goldwasser said several interested parties came to look at the building that's just west of Chicago's Loop.