Duke Realty Starts Build-to-Suit Projects Near Chicago

Duke Realty has begun construction of two build-to-suit developments for two national retailers in the Chicago area totaling more than 1.8 million square feet. Wayfair LLC is taking the larger of the two spaces but both tenants have signed long-term leases.

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The 1.2 million-square-foot e-commerce fulfillment center for Wayfair is being built on 81.8 acres at the Airport Logistics Center Phase II in Romeoville, Ill. Located at 1040 West Renwick Road, the site met Wayfair’s requirement to be in an area with a strong talent pool, because it plans to employ as many as 500 workers during peak times of the year.

1040 West Renwick Road. Image courtesy of Duke Realty

An unidentified national home improvement retailer is leasing the smaller of the two facilities—a 655,200-square-foot building at 6600 West 68th St. in Bedford Park, Ill. The property will serve as bulk and flatbed distribution centers to meet same-day and next-day delivery needs of customers in close proximity to Interstates 294 and 55. The tenant also wanted an infill site with access to a short line railroad. The facility will have 46 dock doors, 293 trailer spaces and 205 car spaces.

Duke Realty will seek LEED certification for both of the developments.

Susan Bergdoll, vice president of leasing and development overseeing Duke Realty’s Chicago and Minneapolis operations, said in a prepared statement the two large-scale projects accommodate customer requirements for modern, convenient facilities close to airports, interstate highways and consumers in communities with robust talent pools. She said the REIT’s investment strategy aligns with customer demands for updated facilities and convenient locations. Bergdoll said Duke Realty will continue to focus on infill locations, where it can redevelop and provide tenants with best-in-class facilities as increased e-commerce activity continues to drive growth.

The REIT worked closely with tenant brokers John Suerth and Jon Varholak from CBRE and listing brokers Jason West and Sean Henrick from Cushman & Wakefield in negotiating the deal for the Wayfair project. Tony Kepano and Matt Mulvihill from CBRE were the tenant representatives and Chris Gary from NAI Hiffman was the listing broker for the Bedford Park transaction.

More Duke deals

Earlier this month, Duke Realty secured a long-term lease with a global provider of wireless services and device management solutions at Lakeside Ranch 350, a speculative facility at the master-planned Lakeside Ranch Business Park in Flower Mound, Texas. The unidentified tenant will be using the entire building near the Dallas/Fort Worth International Airport as its primary North American distribution space.

In February, the REIT secured a long-term lease with Bob’s Discount Furniture for a 622,230-square-foot distribution facility under construction in Piscataway, N.J. near the New Jersey Turnpike.