Westmount Realty Buys Chicago Portfolio
The collection is situated in key submarkets with strong industrial demand.
Westmount Realty Capital has acquired nine light industrial properties in the Chicago metropolitan area. The sellers, Unilev Capital and Mandalay Industrial, were represented by JLL in the transaction, the Chicago Business Journal reported.
Dubbed Chicago Shallow-Bay, the portfolio comprises more than 390,781 square feet of space in four key submarkets, including North DuPage County and the I-55 corridor. These submarkets continue to outperform the Greater Chicago industrial market, according to a company statement.
Twenty-eight industries are represented in the spaces. Cumulatively, the properties are 91 percent leased to 37 tenants. Westmount would not disclose the price or specifics about the assets.
In 2022, Westmount divested an industrial portfolio consisting of 21 buildings near O’Hare International Airport, according to the same source. Its current footprint in the market totals 4.8 million square feet.
That same year, the company also sold a 709,652-square-foot industrial asset in metro Nashville, Tenn. Located at 245 Couchville Industrial Blvd. in Mt. Juliet, in the Wilson County submarket, 840 Logistics Center was fully leased at the time of sale.
Chicago’s industrial strength
JLL calls the Chicago MSA the second-largest industrial market in the U.S. and the market to watch in 2025. Recent activity reflects that reputation.
T2 Capital Management is currently financing the construction of two industrial buildings in the Chicago area, according to John Felker, its co-CIO.
“Chicago’s industrial market has fared better than other major industrial markets,” he told Commercial Property Executive. “Vacancy rates in Chicago are below the national average, and development of new space slowed considerably in 2024. This has kept supply more in check with demand growth.”
READ ALSO: Why Light Industrial Properties Will Continue to Shine
Chicago is a prime location for industrial assets for multiple reasons, according to Felker. Nearly 50 percent of Americans live within a one-day drive of Chicago; however, other midwestern cities share that characteristic. Chicago’s workforce and transportation infrastructure set it apart from other midwestern industrial hubs, Felker added.
Chicago-based developers Range Group and HSA Commercial Real Estate plan to develop a pair of 35,000-square-foot small-bay warehouses on Chicago’s Near West Side—at 2519 W. Fulton Ave. and 2520 W. Lake St.
The goal is to capitalize on the growing demand for Class A infill industrial facilities in established population centers, according to Robert Smietana, president & CEO of HSA Commercial.
Developed on a speculative basis, the warehouses can accommodate multiple tenants or a single user. They will offer 28-foot clear heights, individual drive-in doors, drive-in docks capable of accommodating 40-foot trucks, and secured automobile parking. Demolition of existing structures on the parcels is expected to begin this spring, with the new buildings being completed by early next year.
“Downtown Chicago and its surrounding neighborhoods are some of the nation’s fastest-growing areas yet are drastically underserved in new warehouse supply, particularly for smaller users,” Smietana told CPE. “Growth industries such as e-commerce and manufacturing will drive competition for urban industrial space in the near future.”
In December, there was ground-breaking for the final phase of Pullman Crossings with Ryan Cos.’ 160,000-square-foot development in the South Side that is expected to come online in August.
Not so boom and bust in Chicago
“Boom and bust cycles in the sector have been more muted throughout Chicago versus the coasts, as deliveries and a construction pipeline support Chicago’s below market vacancy rates, with the national average at 7 percent and Chicago at 5.5 percent,” said Laura Dietzel, real estate senior analyst with RSM based in Chicago.
Deliveries over the last 12 months comprise just 1 percent of Chicago’s total inventory while the national figure is about 2 percent or double that, she added.
“Landlords in Chicago are well positioned to face less supply-side competition than in other markets through the near term,” Dietzel said.
Chicago’s central location also makes it a critical logistics hub in the U.S., with proximity to major airports, railways and highways allowing for effective distribution.
“Lastly, there’s an underlying macro-trend related to re-shoring of critical manufacturing to the U.S., which the current administration’s focus will bolster.”
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