Dayton street partners acquires six-building logistics park in bensenville

October 19, 2023 - Rejournals.com

Dayton Street Partners (DSP), a logistics real estate investment and development firm headquartered in Chicago, has closed on the acquisition of a six-building logistics park set on 11 acres at 700 Larsen Lane in Bensenville, Illinois. The seller was a private investor.

The park is comprised of a 37-door truck terminal, two truck maintenance facilities and a warehouse with one acre of outdoor storage. Located within the highly desirable O’Hare Industrial Submarket in DuPage County, it is directly across the street from O’Hare International Airport. It was 85% leased at the time of sale.

DSP will commence with a multi-million dollar renovation of the terminal in November.

CBRE’s Jack Brennan represented the seller is exclusive marketing agent for the property.

DSP continues to expand its portfolio with recent IOS and logistics related acquisitions in Atlanta, Tampa, Nashville, Savannah and San Diego. It recently completed the development of a 216 door, 1000 trailer terminal on 47 acres in Houston.

Dayton street acquires 9-acre site for ios development in san diego, ca

September 7, 2023 - daytonstreetllc.com

CHICAGO (September 7, 2023) - Dayton Street Partners (DSP), a logistics real estate investment and development firm headquartered in Chicago, has officially disclosed its acquisition of a 9-acre land site strategically situated at the intersection of La Media and Lone Star adjacent to the Otay Mesa East Port of Entry in San Diego, California.

DSP will immediately commence construction, transforming this 9-acre infill site into a state-of-the-art trailer drop yard that will be paved, lit and secured.

This property is strategically located within the Otay Mesa submarket of San Diego, California, serving as a vital border port for U.S./Mexico trade and supply chain operations. Located adjacent to the Otay Mesa East Port of Entry, a dedicated U.S./Mexico border crossing designed specifically for commercial trucks, this site holds immense strategic significance. Construction of this innovative commercial border crossing is already underway, with an expected culmination in the fourth quarter of 2024.

Given its prime location, Dayton Street Partners anticipates a high level of interest from logistics and transportation-oriented tenants seeking direct access to the U.S./Mexico border crossing.

Howard Wedren, Founder and Managing Principal of Dayton Street, commented, “Upon completion, this strategically located in-fill site will offer fully improved trailer parking and outside storage at one of the most supplied constrained borders in the United States. This acquisition falls in-line with DSP”s mission to acquire and develop high-barrier to entry IOS and logistics real estate across the U.S.”

The firm continues to expand its portfolio with IOS and logistics related acquisitions in Atlanta, Tampa, Nashville and Savannah.

The Seller was represented by Brent Aberg, Bryce Aberg, and Zachry, who will continue to serve as exclusive marketing agents for DSP.

Dayton Street Partners is a Chicago based commercial real estate investment and development firm focused on the acquisition and development of high barrier to entry infill IOS, industrial and logistics properties across the United States.

Brochure: Marketing Brochure

Dayton street hires acquisitions director

June 22, 2023 - Costar.com

Dayton Street Partners, a fast-growing logistics property developer and investor, has added industry veteran Joe Olin as director of acquisitions. He joined Dayton Street from Banyan Street Capital, where he sourced and closed transactions that had an aggregate value of more than $800 million and involved a total of over 5 million square feet of space.

Olin’s experience across several markets will benefit the firm as it continues on its growth path, Dayton Street founder and managing principal Howard Wedren said. “He quickly becomes an integral member of the team which continues to drive DSP’s expansion into high growth in the U.S.” Wedren said in a statement.

Before working at Banyan Street, Olin served as a vice president in CBRE’s capital markets group in Boston. At CBRE he specialized in middle-market sales of office and industrial properties across the Boston area. He’s now based in Miami.

This week’s atlanta deal sheet: ackerman beefs up i-20 industrial portfolio

June 22, 2023 - Bisnow.com

Ackerman & Co. is expanding its industrial holdings with the purchase of a 212K SF warehouse in Conyers.

The local commercial real estate firm purchased 2020 East Park Drive on the Interstate 20 corridor from Dayton Street Partners. Ackerman Senior Vice Presidents Brett Buckner and Chris Miller have been tasked with leasing the property, which was built in 2022 completely on spec.

This is the latest investment in industrial real estate made by Ackerman in recent years. In 2017, it developed a 1M SF warehouse called Braselton Logistics Center that was leased by Uline. Ackerman also built Rockdale Technology Center, a five-building collection of Class-A industrial warehouses totaling 1M SF.

ios developments drive forward despite entitlement, zoning challenges

May 16, 2023 - Bisnow.com

With the trifecta of idling engines, diesel exhaust and the constant presence of 18-wheelers, industrial outdoor storage operators fight an uphill battle getting their projects approved by municipalities. But rising demand - and the rising prices that come with - has motivated developers to find ways forward despite community backlash.

Entitlement challenges, zoning difficulties and pushback from NIMBY-esque neighbors slow the production of IOS properties, causing developers to create strategies targeted at avoiding these pitfalls to get their deals done and meet a ballooning market need.

“The lack of available supply for truck terminals has historically been driven by local zoning ordinances,” said Cresa broker Eric Rose, who is based in Omaha, Nebraska. “Most communities aren’t friendly and won’t really add any more of these locations unless it’s a case-by-case, special-use approval process, which is time-consuming and costly.”

As the continued growth of e-commerce and a renewed domestic manufacturing sector add pressure to expand trucking to handle increased logistics demand, some developers are striking out and figuring out how to add new capacity. With IOS vacancy rates slipping to 3% in 2022, according to Marcus & Millichap research, the need is clear. And with the high rents and sales prices being fetched by existing IOS properties, ground-up development can offer a significant payday, especially from interested institutional investors or truck carriers.

Earlier this month, Industrial Outdoor Ventures announced plans to turn the Twin Lakes Travel Park in Davie, Florida, 24 miles north of Miami, into a 38-acre industrial service facility. Situated south of Interstate 595, between State Road 7 and Florida’s Turnpike, the ground-up development will include two buildings totaling 227K SF and outdoor storage yards that can hold 280 truck trailers.

“This is another great opportunity for IOV to meet market demand by developing the type of modern facilities that today’s end users require and in a location that has a scarcity of land available for this type of asset,” Industrial Outdoor Ventures Senior Vice President of Development and Acquisitions Eric Johnson said in a statement.

Turnbridge Equities also just picked up a 3.6-acre site in Rancho Dominguez, California, near Los Angeles, in a $25.5M buy. The deal, another 2.49-acre pickup in the South Bay, “aligns perfectly with our strategic vision of expanding our Industrial Outdoor Storage strategy in port-adjacent, infill and high barrier-to-entry markets,” a Turnbridge executive said in a statement. In nearby Perris, California, Alterra IOS spent $8.5M on a 7-acre towing yard in early May, with plans to renovate it and reintroduce it as an IOS property with easy access to the busy Inland Empire.

Chicago-based Dayton Street Partners has been busy with redevelopments and plans to create new trucking facilities, one of just a handful of ground-up IOS developments taking place. The firm just finished a 95-acre terminal with 500K SF of industrial space at 5800 Mesa Road in Houston, which is being leased to the carrier Maersk.

The firm also has a 47-acre, 1,000-trailer terminal set to open in Baytown, Texas, near Houston and less than 20 miles from two Gulf ports, set to open in June. The terminal includes a 24-foot-tall, 1,.382-foot-long building meant for unloading and reloading truck cargo. In addition, Dayton Street acquired two truck maintenance facilities in Atlanta with plans to renovate and reopen.

The difficulties of finding appropriate space and building new facilities - often renovating existing industrial or vehicle-focused real estate, such as mobile home parks or underutilized warehouse sites with vacant buildings and minimal need for rehabilitation - means it often isn’t worth it to seek out real estate on the fringes of a market, Dayton principal Howard Wedren said. Financing has been rocky lately, he added, so it is difficult to get access to capital compared to those with longstanding client relationships.

It is key to find locations near big travel hubs and ports, spots already in high demand for industrial developer seeking storage space.

“We don’t go to the outskirts, “ Wedren said. “We’re very much into the high-barrier-to-entry sites. That’s our model, and we don’t deviate.”

High barriers are common for IOS projects. In Long Beach, California, the firm Cargomatic received city council approval for an IOS storage site last month near the busy Pacific port, just overcoming significant backlash by business groups and local leaders concerned about additional pollution from heavy trucks.

“There are no guarantees at the end of the day,” Cresa’s Rose said. “So do you go through a multiyear development process, not 100% certain that you’re going to get those rezoning and entitlements you need? Or do you just bite the bullet and buy the existing facility, and you can activate your service immediately upon opening the facility?”

In the case of Industrial Outdoor Ventures’ project in Davie, Director of Construction and Properties Rob Chase said the firm had a good relationship with local leaders. It helped that the older travel park was showing signs of age and wear, and many in town were happy to replace the site with something newer.

Even with the support, it is a long process. Properly and fairly relocating existing residents is time-consuming, and even with the relatively simply construction requirements of these kinds of projects, it will still take 14 months of site work and construction once the site is cleared.

On the flip side, an empty site in Jurupa Valley, California, near the Inland Empire, that Industrial Outdoor Ventures acquired on the precipice of gaining approvals for construction in a portfolio purchase, now has to restart the entitlement process.

Chase said he sees the value of existing and new IOS facilities continuing to rise, spurring more developers to attempt more conversions, but he acknowledged that the process if often difficult.

“Having the right zoning is absolutely critical,” he said. “An entitlement process I describe a being long and drawn out is nothing in comparison to trying to change the zoning. That’s even more of a hill to climb. You could easily flip these properties, but pushing, sticking with it through to the finish line, is worth it.”

DAYTON STREET PARTNERS sells houston industrial property on 95 acres

February 16, 2023 - Costar.com

A 500,000-square-foot industrial building and truck terminal spanning 95 acres in Houston has a new owner.

Chicago-based Dayton Street Partners sold the property at 5800 Mesa Drive to Irving, California-based LBA Logistics. The building was fully leased to Maersk at the time the deal closed, according to a statement from Dayton Street Partners. Financial terms of the deal were not disclosed.

Dayton Street Partners made $30 million in renovations to the property after acquiring it from a private investor in early 2021, according to the statement. Improvements included the development of 25 acres for upgraded trailer parking. The property features 330 door, 33 bays and a 46,000-square-foot maintenance facility.

The industrial building is located in a corridor where many transportation and logistics companies lease space. Those tenants include Estes Express, J.B. Hunt, Knight Transportation, Kroger, Lineage Logistics, Rush Truck Centers, SAIA, Southwest Freight and Tyson Foods.

Dayton Street Partners is an active investor and developer in logistics real estate. The firm primarily focuses on acquiring or developing infill industrial and logistics properties across the United States.

Some of Dayton Street Partners’ current projects include: DSP Cedarport Industrial Park, a 164,640-square-foot terminal featuring 215 doors on 50 acres in Baytown, Texas; Rock House Logistics Center, a 431,000-square-foot cross dock logistics center on 40 acres in Lithia Springs, Georgia; and DSP I-16 Logistics Center, a 548,818-square-foot rear load facility featuring 92 loading docks on 52 acres in Savannah, Georgia.

LBA Logistics has a portfolio on industrial properties, mostly near ports and airports. The company focuses on last mile, infill and regional distribution. LBA Logistics’ portfolio features three properties in Texas: Cedars Commerce Center in Dallas; 11945 Katy Freeway in Houston; and Elizabeth Creek Gateway in Fort Worth, Texas.

DAYTON STREET PARTNERS buys 65-acre industrial campus in metro dallas, plans expansion

January 12, 2023 - rebusinessonline.com

RICHARDSON, TEXAS - Chicago-based developer Dayton Street Partners has acquired a 65-acre manufacturing and distribution campus in the northeastern Dallas suburb of Richardson with plans to expand the site. The undisclosed seller has agreed to lease back 10 percent of the space at the 845,000-square-foot campus, and electronics manufacturer Celestica has leased 672,588 square feet. The seller also vacated the remaining 90,000-square-foot building, at which Dayton Street has launched a capital improvement program. The expansion will feature a 240,000-square-foot facility on a nine-acre parcel that is expected to be complete in early 2024. Larry Serota, Mike Hardage and Nora Hogan of Transwestern represented the seller in the transaction.

DAYTON STREET PARTNERS acquires 65-acre high tech manufacturing and distribution campus in richardson

January 11, 2023 - rejournals.com

Dayton Street Partners (DSP) has acquired a 65-acre, four building, high-tech manufacturing and distribution campus in the Dallas suburb of Richardson, Texas.

Upon close, the seller, a leading provider of IT and communications networks, signed a leaseback for 10% of the 845,000-square-foot campus while Celestica, the multinational electronics manufacturing services company, executed a lease for 672,588 square feet. The remaining 90,000 square feet is a single-story industrial facility that the seller vacated at close. DSP will immediately begin a significant renovation and repositioning the building.

In addition, the Chicago-based developer/investor plans to develop a 240,000-square-foot warehouse/distribution center on nine acres of unimproved land. Completion is expected in early 2024.

Located in the I90 Stem Corridor, the campus offers immediate access to President George Bush Turnpike Highway (Highway 190), US 75 and a highly skilled labor pool. The campus was constructed in two phases: Phase I was completed in 1990 and Phase II in 2001.

Transwestern’s Larry Serota, Mike Hardage and Nora Hogan represented the seller in the transaction.

DAYTON STREET PARTNERS BUYS RICHARDSON HIGH-TECH FACTORY FOR $68.6m

January 6, 2023 - Connectcre.com

Dayton Street Partners (DSP) has acquired a 65-acre, four building, high-tech manufacturing and distribution campus from IT Services company Fujitsu in the Dallas suburb of Richardson. The sale was financed using a loan worth $68.6 million.

Upon closing, Fujitsu signed a leaseback for 10% of the 845,000-square-foot campus while Celestica, a multinational electronics manufacturing services company aligned with Fujitsu, executed a lease for 672,588 square feet. The remaining 90,000 square feet is a single-story industrial facility that the seller vacated at close. Dayton Street Partners will immediately begin a significant renovation and repositioning of the building. The project is located just off the 190 Business Corridor.

In addition, DSP plans to develop a 240,000-square-foot warehouse/distribution center on nine acres of unimproved land. Completion is expected in early 2024.

DSP’s Howard Wedren said, “This acquisition falls in-line with DSP’s mission to acquire and develop high-barrier to entry logistics real estate across the U.S.”

chicAGO INVESTOR BUYS DALLAS-AREA FUJITSU HUB IN FIRST OF SEVERAL PLANNED SIMILAR DEALS

January 9, 2023 - Costar.com

Fujitsu Network Communications, a subsidiary of the Tokyo, Japan-based Fujitsu family of companies, sold its Dallas-area manufacturing and distribution campus to a real estate investment firm that has plans to buy similar properties across the country over the next two years using $100 million of institutional funds.

Dayton Street Partners, based in Chicago, bought the 845,000-square-foot campus in Richardson, Texas, about 20 miles north of downtown Dallas. Fujitsu Network Communications leased back about 10% of the property and Toronto-based electronics manufacturing company Celestica leased about 672,588 square feet at the property.

The industrial off-market deal is the first of up to 20 that Dayton Street Partners is planning to execute over the next 18 to 24 months, said Howard Wedren, founder and managing principal of Dayton Street Partners.

“We have $100 million institutional commitment to buy industrial, off-market, value-add deals,” Wedren told Costar News in a phone interview. “This asset fits into that platform, which is the first property in a much larger initiative for the company. We will hopefully have additional raises as institutional investors look for a mix of credit and value-add components.”

Wedren said his team plans to replicate the acquisitions in high-growth cities throughout the southeast and southwest United States, including Texas.

“We are talking to corporations who want to shore up their balance sheets and sell off excess real estate,” he added. “Everyone has been hit hard by the capital markets and we can come in and purchase assets for cash and help them shore up their balance sheets.”

Terms of the deal for the 65-acre property were not disclosed. The deal was financed through a $68.6 million loan. Fujitsu Network Communications did not immediately respond to media request from CoStar News about its reasons for selling the property.

Dayton Street Partners is planning a multi-million dollar renovation to transform a single-story, 90,000-square-foot building at the Richardson campus that was once a call center into a distribution center or warehouse for a would-be tenant, Wedren said. In addition, Dayton Street Partners plans to develop a new 240,000-square-foot warehouse and distribution center on the remaining nine acres of undeveloped land on the property - if capital markets hold, Wedren said. If all goes well, the $22 million proposed project could be completed in early 2024.

The initial phase of the Fujitsu campus was completed in 1990, with a second phase completed in 2001. The campus has immediate access to President George Bush Turnpike and is a 10-minute drive to the University of Texas at Dallas.

Even though Dallas-Forth Worth is home to the nation’s largest pipeline of new industrial construction, Richardson has seen little of that activity. CoStar’s market analysts say, “data centers have accounted for virtually all new construction since 2010” in this part of the North Texas region, noting that large blocks of space are rare.

“Richardson has a few vacant tracts, and most are zoned for residential or office use,” according to CoStar’s market analysts. "Large-scale [speculative industrial] projects are unlikely to emerge in Richardson.”

For the Record

Transwestern’s Larry Serota, Mike Hardage and Nora Hogan represented the seller, Fujitsu Network Communications in the deal.

dsp highway 280 distribution center coming to bryan county

October 11, 2022 - wtoc.com

Savannah, Ga. (WTOC) - A new distribution center is coming to Bryan County. Chicago-based Dayton Street Partners is set to break ground on the new facility later this month. The new unit will sit near the intersection of highway 280 and I-16.

Project organizers are praising the location’s direct access to the highway and proximity to the Bryan County mega site.

Project organizers say the location will allow the facility to serve the growth of the Savannah port.

“I-16 carries the bulk of the product coming out of the Port of Savannah. So from that standpoint it makes a lot of sense for logistics and distribution purposes,” Director of Acquisitions Joe Moriarty said.

DSP Director of Acquisitions Joe Moriarty says the Bryan County mega site announcement put a renewed spark in DSP’s decision to build a time when inflation was impacting the process.

“There were a lot of lenders that had stepped aside and said they weren’t going to be providing debt going forward for the rest of year. So, it was a tough time to close on land. But, I think the Hyundai thing really helped support our investment thesis. It was a really nice mode of support for the project,” Moriarty said.

And while Moriarty says the company doesn’t have a specific tenant in mind he says there’s interest from companies to use the space as a potential supplier for the Hyundai plant.

“I expect that our building and some of the buildings that are going up around here, I think there are going to be a lot of suppliers interested in taking space.”

The new facility is expected to be just over 540,000 square feet and is set for completion by later next year.

chicago real estate firm breaks ground on over 500,000 square foot unit near hyundai plant

September 24, 2022 - savannahnow.com

Dayton Street Partners, a Chicago based real estate firm, announced it will break ground on a 548,000 square foot unit on Highway 280 in Ellabell. DSP I-16 Logistics Center will be located one mile from the Hyundai plant, which is set to open in 2025.

“The biggest thing for us with this project specifically is it has frontage to Highway 280 and it is within two miles of I-16,” said director Joe Moriarty. “I-16 carries plus or minus 70% of the product going out of the Port of Savannah.”

The facility is being built to support growth at the port, with the possibility of becoming home to a Hyundai supplier. The unit will feature a reload facility, and auto and trailer parking amount other amenities.

“We’ve had various suppliers that have kind of reached out just with high level inquiries,” said Moriarty. “By no means do we have anything locked up at this point. But we do foresee suppliers reaching out, and potentially something happened there. I-16 is a major thoroughfare for goods leaving the port. And that’s really the investment thesis. It’s just immediate access to 16. And we think it’s a perfect location for routing goods to and from the ports.”

Construction of the building will begin next month and is scheduled for completion in October 2023. Moriarty applauded officials in Bryan County for helping his team get the green light to start turning dirt next month.

“Bryan County has been tremendous to work with,” said Moriarty. “They are really a first-class municipality and they’ve been a big part of us being able to get to this point.”

dayton street PARTNERS ANNOUNCES LOGISTICS CENTER PLANS

September 15, 2022 - effinghamherald.net

SAVANNAH — Dayton Street Partners recently announced it will be breaking ground on DSP I-16 Logistics Center, located at the intersection of I-16 and Highway 280.

Within 22 miles of the Georgia Ports Authority Garden City Terminal and one mile north of the new $5.5B Hyundai Motor Group Electric Vehicle Plant, the I-16 Logistics Center is ideally situated to accommodate a multitude of Port of Savannah related tenants that require convenient accessibility to the Port in addition to both I-16 and I-95.

The 548,818 square foot rear-load facility will be located at 11900 Ga, Hwy 280 in Ellabell and feature 36-foot clear ceiling heights, 92 loading docks, two ramped drive-in doors, 298 parking stalls, 112 trailer stalls, 4,000 amps of power and Ga. Hwy 280 frontage.

“The I-16 Logistics Center is well positioned for routing goods to and from the Port of Savannah. We look forward to capitalizing on the rapid expansion in the I-16 submarket, fueled by Hyundai’s recent announcement to construct its first fully dedicated electric vehicle and battery manufacturing facility along I-16,” said Joe Moriarty, Dayton Street Partners director of acquisitions.

Dayton Street Partners is a Chicago-based real estate developer and investor focused on the acquisition and development of high barrier to entry infill industrial and logistics properties. The DSP I-16 Logistics Center will be the firm’s third development in Georgia in the past two years. In 2021, Dayton Street completed an 180,300 distribution center in Atlanta’s airport submarket and recently completed a 212,232 SF distribution center in Atlanta’s I-20 East submarket.

Multiple local partners have played an integral role in the development alongside Dayton Street Partners including Savannah-based commercial real estate firm Cushman & Wakefield, Gilbert & Ezelle, Evans General Contractors and the Bryan County Development Authority.

“We are excited to see the development of the I-16 Logistics Center,” said Development Authority of Bryan County Chairman Jon Seagraves. “This almost 550,000 square-foot facility will be another asset to the community that will allow us to continue creating good jobs and meeting industry demands.”

The development will support the continued explosive growth in import, export, and e-commerce shipping activity through the Georgia ports. The project is expected to start in October 2022 and completion is anticipated in the fourth quarter 2023.

dayton street divests two chicago warehouses to brookfield

August 12, 2022 - connectcre.com

Dayton Street Partners (DSP), a Chicago based commercial real estate company focused on the acquisition and development of industrial and logistics properties, has sold two facilities in Chicago to Brookfield Properties for an undisclosed sum.

The first property, located at 2501 W. Fulton St., is a 42,000-square-foot warehouse/distribution facility situated on 1.5 acres. DSP acquired the 956-vintage property in 2019 and commenced with a renovation, followed by a full-building lease to Vienna Beef.

The other facility, located at 1827 W. Hubbard, is a 33,000-square-foot warehouse with 14’ clear ceiling height, two loading docks, one drive-in door and parking for 34 cars. Built in 1960, the vacant building sits on 1.75 acres.

“Chicago continues to be a target market for investors seeking high barrier to entry industrial properties in submarkets experiencing record low vacancy,” said Howard Wedren, DSP’s founder and managing principal.

dayton street partners sells two industrial assets in chicago to brookfield properties

August 9, 2022 - rejournals.com

Dayton Street Partners (DSP), a Chicago based commercial real estate company focused on the acquisition and development of industrial and logistics properties, has sold two facilities in Chicago to Brookfield Properties for an undisclosed sum.

The first property, located at 2501 W. Fulton St., is a 42,000-square-foot warehouse/distribution facility situated on 1.5 acres. Built in 1956, it features 16-foot clear ceiling height, two internal docks, one overhead door and secure parking for 50 cars.

DSP acquired the property in 2019 and commenced with a renovation that included improving the parking lot, painting the warehouse, and installing LED lighting. Shortly after closing, DSP leased the building to Vienna Beef Ltd.

The other facility, located at 1827 W. Hubbard, is a 33,000-square-foot warehouse with 14-foot clear ceiling height, two loading docks, one drive-in door and parking for 34 cars. Built in 1960, the vacant building sits on 1.75 acres. DSP acquired the property in 2020 and commenced with a renovation that included a new facade, parking lot upgrades and a freshly warehouse.

Both properties are situated in highly desirable infill locations with easy access to major interstate systems such as I-90/94, I-290, as well as Chicago’s CBD.

Houston industrial park draws spec investors on 47-acre deal

July 7, 2022 - therealdeal.com

Dayton Street Partners has acquired land it plans to develop into the first truck terminal built on spec at Houston’s TGS Cedar Port Industrial Park.

The deal for the 47-acre site, which came on undisclosed terms, underscores Houston’s growing important as a logistics hub.

Cedar Port is billed as the largest industrial park with rail and barge service in the U.S. The 15,000-acre facility is adjacent to Houston’s Grand Parkway, Interstate 10, State Highway 225, State Highway 146, and the Port of Houston.

Major retailers such as Home Depot, Floor & Decor, IKEA, Walmart, Vinmar, and Ravago all have major distribution and fulfillment centers at Cedar Port.

Houston’s emergence as a logistics hub has led major real estate investment firms to create separate businesses focusing on the city’s industrial space.

Houston had the third fastest-growing industrial market in the first quarter of 2022. Over the last four quarters, investment in Houston’s industrial real estate market totaled $5.549 billion, a year-over-year growth of 178.8 percent, compared to the national growth of 44.5 percent, according to CBRE.

Growth like this prompted CBRE to expand its Industrial & Logistics Capital Markets team in Houston.

Industrial warehouses in Houston and Harris County saw their value increase an average of 19 percent since 2021.

Dayton Street’s speculative facility which is slated to open in the second quarter of 2023, will total 164,64-square-feet of space that can be built to accommodate office space, a guard shack, a 10,000 square-foot truck maintenance facility and a fueling station.

NAI Partners’ Gray Gilbert, Chris Haro, and Jack Gilbert are the exclusive leasing agents of the property, according to an NAI press release.

Dallas-based Veritex Community Bank is providing construction financing.

The terms and pricing of the deal were not disclosed.

‘First-of-its-kind’ 164k sf truck terminal planned in baytown

July 6, 2022 - bisnow.com

Dayton Street Partners purchased 47.4 acres for a Class-A speculative truck terminal in Baytown.

The property was purchased from the 15,000-acre TGS Cedar Port Industrial Park. Dayton intends to build a 164.6K SF speculative truck terminal, which the company is calling the first of its kind in Houston. It will have a 6K SF build-to-suit office, a guard shack, a 10K SF truck maintenance facility and a potential fueling station. It is expected to be complete in the second quarter of 2023.

“Houston has proven itself as a powerhouse logistics hub,” Dayton Street Partners founder and Managing Principal Howard Wedren said in a release. “The opportunity to join the incredible development at Cedar Port Industrial Park and bring the very first spec truck to the area is tremendous and we look forward to continued involvement in Houston’s logistics market.”

NAI Partners’ Gray Gilbert, Chris Haro and Jack Gilbert will lease the property, while Veritex Community Bank is providing construction financing.

Chicago-based Dayton Street Partners previously announced a redevelopment at 5800 Mesa Drive, a 500K SF logistics terminal. The deal was announced in May, though the affiliated company wasn’t announced at the time.

High demand in the Houston industrial market, combined with declining vacancy, is leading to rising industrial rents across the city. Second-quarter 2022 rent is now 58 cents per SF, up from 49 cents per SF last year. And despite 19.4M SF of industrial property under construction, vacancy is down 3.8% over the last year, according to Q2 Savills data.

“Recent strong trade volumes, which grew by 16% in tonnage over the past 5 years, along with investments in port infrastructure are expected to support a healthy industrial market in the region over the long term,” the Savills report says. “With robust demand reflected by quarterly leasing activity and net absorption, developers continue to be bullish building new product to meet tenant requirements.”

dayton street partners signs 16,473-square-foot lease in elk grove village

June 22, 2022 - rejournals.com

Dayton Street Partners (DSP) has signed Associated Builders and Contractors, Illinois Chapter Inc. (Associated Builders), to a full building lease at 2454 Elmhurst Road in Elk Grove Village.

Built in 1982 on 1.3 acres, the 16,473-square-foot warehouse features 13-foot clear height ceilings, 4,900 square feet of office space, five exterior docks, two drive-in doors and parking for 46 cars. It is situated at York and Elmhurst Road, directly across the street from Chicago O’Hare International Airport and offers direct access to O’Hare’s south cargo entrance via York Road and East Irving Park Road. The interstate system is immediately accessible to the north and south of the property. 

DSP acquired the building in January 2020, along with 2500 York Road in Elk Grove Village, as part of a portfolio purchase.

dayton street partners signs gsa to full-building lease

June 19, 2022 - connectcre.com

Chicago-based Dayton Street Partners (DSP) has signed the GSA/U.S. Justice Department to a new, 55,000-square-foot lease at its industrial property at 2500 York Rd. in Elk Grove Village, IL. GSA will occupy 100% of the asset.

“The supply of highly functional industrial properties in close proximity to the airport remains incredibly low,” said Howard Wedren, DSP founder and managing partners. “This scarce supply continues to drive an insatiable demand for these types of buildings.”

The 55,356-square-foot warehouse sits on 3.3 acres and features two interior docks, three drive-in doors and parking for 110 cars. Ceiling height ranges from 24’ to 38.6’. One of only a few crane-served properties in the O’Hare submarket, it has two five-ton and two two-ton cranes. It is located at the intersection of York and Elmhurst Roads, directly across the street from O’Hare International Airport.

DSP acquired the building in January 2020.

dayton street partners onboards new associate

May 31, 2022 - rejournals.com

Dayton Street Partners (DSP) has welcomed Brandon Shanklin to its team As an associate, he will support DSP’s acquisition and development groups and will be responsible for underwriting and sourcing industrial and land site acquisitions for development opportunities.

Brandon began his career as an associate at Heitman where he worked on their open-ended debt fund called CREDIT with a focus on asset management and fund operations. He is a graduate of Marquette University in Milwaukee, WI.

DSP focuses on the acquisition and development of high barrier to entry industrial and logistics properties across the country. The firm continues to grow its business and recently expanded its portfolio with logistics related acquisitions in Miami, Orlando, Nashville, Charlotte, Tampa, Houston, and California’s Central Valley.

dayton street partners welcomes new director of asset management

May 20, 2022 - rejournals.com

Adam Seyfarth has joined Dayton Street Partners (DSP) as its director of asset management. Adam will be responsible for the day-to-day oversight of the firm’s existing portfolio and dispositions.

Prior to joining DSP, Adam worked as an Asset Manager and Acquisitions Associate for Equus Capital Partners. Adam managed over two million square feet of office properties and was involved in more than $400 million of sale/acquisition transactions while there.

He is a graduate of the University of Illinois Urbana-Champaign and earned an MBA from DePaul University.

DSP continues to grow its business locally and throughout the U.S.. In the past several years, DSP has expanded its industrial and logistics holdings across the United States in growth markets like Atlanta, Savannah, Phoenix, Houston, Tampa, Nashville, Charlotte and Miami.

CBRE negotiates 500,000 sf industrial lease in northeast houston

May 10, 2022 - rebusinessonline.com

HOUSTON- CBRE has negotiated a 500,000-square-foot, full-building industrial lease at 5800 Mesa Drive in northeast Houston. Situated on 95 acres, the property features 330 terminal doors, a 46,000-square-foot maintenance facility and 25 acres of secured trailer parking. Tres Reid and Andrew Jewett of CBRE represented the tenant, an undisclosed logistics firm, in the lease negotiations. John Simons, Gray Gilbert and Chris Haro of NAI Partners, along with Dave Dandurand of Burr & Temkin, represented the landlord, Dayton Street Partners. The Chicago-based investment firm acquired the property in January 2021 and implemented a $25 million value-add program.

logistics company signs 500,000 square foot lease in houston

May 9, 2022 - connectcre.com

Dayton Street Partners (DSP) signed an unnamed logistics company to a full-building, 500,000 square foot lease at 5800 Mesa Drive in Houston. The tenant will utilize the site for transload, distribution, fleet maintenance and trailer parking.

On 95 acres, the building features 330 terminal doors, a 46,000 square foot maintenance facility and 25 acres of secured trailer parking. It’s one of the largest of its kind in the United States.

DSP acquired the property from a private investor in January 2021 and then spent over $25 million to renovate it. It’s located just off I-610 and less than 10 miles from the Port of Houston.

new owner finds tenant for 500,000-square-foot industrial facility in houston

May 5, 2022 - Costar.com

Property Was Renovated to Include 300 Terminal Doors and a 46,000-Square-Foot Maintenance Facility

One of the world’s largest logistics companies has leased the entirety of a 500,000-square-foot industrial in Houston.

The tenant’s identity was not disclosed but Chicago-based Dayton Street Partners, which owns the industrial building, stated the tenant plans to use the warehouse for transloading, distribution, fleet maintenance and trailer parking.

The building at 5800 Mesa Drive is about 10 miles from Port Houston and features 330 terminal doors, 25 acres of trailer parking and a 33-bay, 46,000-square-foot maintenance facility across 95 acres, according to a spokesperson with Dayton Street Partners.

Dayton Street Partners acquired the property in January 2021, marking the company’s first investment in Texas. The new owner then spent $25 million on renovations. The industrial building was originally built in 1977.

The industrial property is located northeast of Interstate 610, just off State Highway 90. Other tenants in the area include several carriers, trucking companies, distributors and manufacturers such as Estes Express, J.B. Hunt, Knight Transportation, Kroger, Lineage Logistics, Rush Truck Centers, SAIA, Southwest Freight and Tyson Foods.

Also nearby include operation for the Union Pacific Rail, XPO Logistics, DHL and Michelin.

FOR THE RECORD

The tenant was represented by CBRE, while NAI Partners and Burr & Tempkin represented Dayton Street Partners.

Easton powers up industrial portfolio with $14m hollywood truck yard

April 7, 2022 - therealdeal.com

The Easton Group hitched a vacant truck yard in Hollywood to the company’s growing industrial portfolio.

An affiliate of the Doral-based commercial real estate development and investment firm paid $14.3 million for the 5.85-acre outdoor industrial site at 3811 Pembroke Road, according to records. The property includes a 29,897-square-foot truck terminal building completed in 1971.

C.J. Easton and David Wilf, both acquisition principals with The Easton Group, sourced the deal, according to a press release. Walter Byrd with Transwestern represented the seller, an affiliate of Chicago-based industrial real estate firm Dayton Street Partners.

The Dayton affiliate paid $7 million for the property in 2020, records show. It was previously leased to the now defunct Central Freight Lines, the release states.

The Easton Group, a family-owned company led by founder and CEO Ed Easton, plans to make improvements to the truck yard and prepare the property for another tenant, the release states.

In a statement, C.J. Easton said The Easton Group is “very bullish on the industrial outdoor space,” noting its a niche sub-sector that “has become increasingly competitive over the last 12 months.”

In Riviera Beach, The Easton Group has submitted plans to the city for a truck terminal on a nearly 9-acre development site that the firm acquired in December, the press release states.

The Easton Group is also actively developing and buying industrial warehouses in Miami-Dade County. In February, the company and its partners LBA Logistics paid $29.4 million for a 26.4-acre property used as a truck yard in Hialeah. The joint venture submitted plans to the city of Hialeah to build two spec warehouses with a combined 462,954 square feet of space.

In neighboring Hialeah Gardens, The Easton Group is developing a 266,000-square-foot warehouse on an 8.4-acre site acquired for $8.2 million in 2020. And in the firm’s homebase of Doral, Easton also teamed up with LBA Logistics to purchase a 105,365-square-foot industrial building for $19.5 million in September.

industrial owners riding high on market fundamentals

February 2022 - REBusinessOnline.com

Parking, storage is key..

Dayton Street Partners (DSP), a Chicago-based real estate investment and development firm, recently acquired a nearly eight-acre trailer parking and storage facility in Chicago. The site offers direct access to I-55. DSP has begun renovating the property after it razed two existing structures to make way for 237 truck trailer stalls. When complete, the facility will be fully lit and fenced with a motorized gate.

“These well-located properties that offer above-standard fleet parking are critical for today’s industrial users,” says Howard Wedren, founder and managing principal of DSP, which owns 30 assets valued more than $300 million.

In September, brokerage Stan Johnson CO. published a report detailing industrial outdoor storage (IOS) as an emerging asset class within today’s industrial market. According to Stan Johnson, IOS properties often command higher rent per square foot than traditional industrial buildings due to the additional value that tenants derive from the outdoor storage component. There is also a limited supply of the asset type, which results in residual values being greater than traditional industrial properties.

“Properties that can accommodate these unique storage requirements are incredibly attractive to tenants in the fields of equipment rental, trucking, building materials, shipping container, chemical, auto/vehicle parking, energy and waste and environmental services, among others,” reports Stan Johnson.

IOS facilities make up one of the three platforms within DSP’s investment strategy. The other two are value-add buildings and ground-up speculative developments.

“The pandemic has only fueled the need for well-located logistics real estate,” Says Wedren. “We are aggressively acquiring land for development in the Southeast, Texas and our backyard here in Chicago and Northwest Indiana.”

Retail spending in the fourth quarter of 2021 was 15 percent above pre-pandemic forecasts, according to Newmark. Thus, space to produce, warehouse and distribute goods has been in high demand as firms race to keep up with consumption.

DSP purchased 42 acres in the Northwest Indiana town of Portage with plans to build a 538,000-square-foot speculative industrial development known as DSP Crossroads Portage. According to Wedren, each speculative development that DSP builds is sold upon stabilization. The typical hold period is one to three years.

In Morton Grove, Illinois, about 16 miles northwest of Chicago, DSP recently sold a 208,000-square-foot distribution center. DSP acquired the asset in 2016 and updated its facade, repaved the parking lots, installed a new roof and added new signage. Brookfield Property Group purchased the building, which at the time of sale was fully leased to five tenants.

Dayton street partners adds to swelling spec industrial pipeline in atlanta

February 16, 2022 - Costar.com

Dayton Street Partners is underway on a speculative distribution center it is betting will attract logistics users looking to capitalize on the Atlanta area’s robust supply chain infrastructure and dense concentration of customers.

The Chicago firm broke ground on its 212,232-square-foot project at 2020 East Park Road in Conyers, a suburb about 25 miles east of Atlanta. The groundbreaking follows DSP’s 23-acre assemblage located along East Park Drive NE and Sigman Round NE and about 3 miles from Interstate 20.

The property should appeal to a variety of users particularly in the distribution, manufacturing and logistics industries, Joe Moriarty, director of acquisitions at DSP, said in a release. Industrial demand has been off the charts in Atlanta as industrial users look to expand their logistics networks in this super regional distribution hub.

Despite a strong speculative supply pipeline, demand has consistently outpaced new completions over the past few quarters. So though speculative development will put some upward pressure on Atlanta’s industrial vacancy rate in the near term, owners have plenty of breathing room before Atlanta industrial vacancies come even close to the area’s pre-pandemic average.

“We are in an excellent position to capitalize on the incredible demand for logistics related properties,” DSP Principal Michael Schack said in a release.

The development is slated to include a 32-foot clear height, 41 trailer and 203 auto stalls with separate access for cars and trucks, and a 185-foot truck court. Construction on the project is expected to wrap up in July.

Dayton street partners breaks ground on 212,232 sf distribution center in conyers, georgia

February 3, 2022 - rebusinessonline.com

CONYERS, GA. - Chicago-based Dayton Street Partners has broken ground on a 212,232-square-foot speculative distribution center in Conyers. Construction is slated for completion by July.

The distribution center will feature 32-foot clear heights, 41 trailer and 203 auto stalls with separate access for cars and trucks and a 185-foot truck court. Located at 2020 East Park Road, the property situated 28.6 miles east of downtown Atlanta and 31.3 miles from Hartsfield-Jackson Atlanta International airport.

Dayton Street most recently completed the development of DSP Rock Hill, a 188,000-square-foot distribution center near Atlanta’s airport. Brookfield acquired the asset in December 2021.

Dayton street partners (DSP) signs another long term lease with penske truck leasing co

January 31, 2022 - daytonstreetpartners.com

Dayton Street Partners (DSP) is pleased to announce it has executed a long lease at our recently acquired Nashville, TN truck terminal to Penske Truck Leasing Co. The truck terminal sits on 15.86 acres of land and has 61 dock doors and a 9 bay maintenance facility. A special thanks to Steve Preston with CBRE who represented both DSP and Penske in this transaction.

institutional investors parking money in atlanta’s outdoor storage market

January 24, 2022 - bisnow.com

WPM Commercial founder Price Muir got a Christmas bonus this year he couldn’t have fathomed in his years buying and selling land around Atlanta.

Three days before Christmas, JPMorgan Chase and Realterm Logistics paid Muir $53.5M for 40 acres of industrial land 11 miles south of Downtown Atlanta. A year earlier, Muir, along with other local partners, assembled the site - a vast sea of truck parking call Transport City - and paid just under $10M.

“Basically, we began buying industrial outside storage four years ago at around $200K to $250K an acre,” Muir said. “It’s now selling for five times that.”

Metro Atlanta has become one of the hottest markets for industrial outdoor storage investors, Stan Johnson Co. Director Zach Harris said during a Bisnow webinar last week, listing Georgia’s capital alongside other in-demand markets like Chicago, Dallas, Houston, Kansas City, Philadelphia, New York, Orlando and Phoenix.

Industrial outdoor storage can be any number of property types, but it is largely undeveloped land for truck and trailer parking, maintenance facilities, construction materials storage and other mainly open-air industrial properties. The investors in these properties are evolving from small, often local real estate players to major institutional funds as the subsector of industrial real estate gains popularity across the country.

“That used to be a kind of a cowboy type of investment group where it was maybe a mom-and-pop and privately owned,” Cushman & Wakefield Senior Director Gordon Benedict said in an interview. “That whole industry has kind of got institutionalized.”

By definition, industrial outdoor storage, or IOS, is when actual buildings take up 20% or less of a property’s total acreage - the excess land is the main attraction. These sites have long been popular with logistics companies, including shipping giants FedEx and UPS as outdoor truck terminals to augment their distribution centers. Construction companies often use IOS properties to store building materials.

Transport City started life as a retail truck stop and hotel, Muir said. WPM tore down the old structures, refurbished a 40K SF maintenance facility and converted individual short-term truck spot leases into three bigger leases to FedEx, Werner Enterprises and Crowley Maritime, Muir said.

Muir said the main attraction for JPMorgan and Realterm wasn’t the maintenance facility, but the paved parking, which has enough space for 1,000 trucks.

IOS has benefited from an overall demand among investors for anything industrial. In Metro Atlanta, some $5.4B worth of industrial properties traded hands in 2021, according to Colliers Atlanta more than twice the previous volume record of $2.69B, set in 2019. And many of those investors were big names in the real estate investment world: names like Blackstone, Goldman Sachs and KKR.

But institutional investors are also buying into IOS, especially when the properties are part of larger industrial portfolios. In 2020, Brookfield shelled out nearly $25M for a portfolio of outdoor storage properties in states like Arizona, Nevada and Texas. Last year, Rexford Industrial Realty paid $16.8M for a nearly 5-acre outdoor storage property in Anaheim, California. Imperium Capital announced in September that it planned to invest more than $250M over the coming year in IOS properties, and in November, Alterra Property Group paid $25.4M for two outdoor storage facilities in Florida.

It’s the hottest thing going in industrial, which is the hottest thing going,” Muir said.

Experts say there are numerous reasons why the IOS sector has grabbed institutional investor attention. IOS properties typically command higher rents for the actual facilities, if structures are on the properties. They can often be found close to major metropolitan areas and the renewal rates from tenants, which are more likely to stay put than go elsewhere, are higher than for average industrial properties, according to a recent report by Stan Johnson Co.

Three years ago, Chicago-based Dayton Street Partners began investing in IOS with institutional investors and has since purchased $300M across the country. This past month, DSP purchased 3275 Moreland Ave., a 37K SF truck maintenance facility that sits on 14 acres in Clayton County. The firm paid $7M for the site, according to a source familiar with the transaction.

The site has enough space for more than 130 trucks according to DSP marketing materials.

“Truck terminals and related industrial facilities which transfer cargo between nodes of transportation are experiencing a structural shift of highly increased user demand and in turn rent growth, due to changes in supply chains,” DSP founder Howard Wedren told Bisnow in an email. “Logistics-related real estate possess a variety of qualities that make them an attractive investment opportunity, including high barriers to entry, higher yields to traditional warehouse space and lower vacancy rates than conventional industrial properties.”

Despite the demand for IOS, the supply isn’t growing. Even though they are fairly cheap to build and maintain, industrial sites close in to major metro areas are often snapped up for more traditional commercial developments.

“If you’re going to build and you got good infill industrial [land]… you’re probably going to put up Class-A space,” said Romit Cheema, the CEO of CanTex Capital in Dallas, during the Jan. 20 Bisnow industrial webinar. “The guys who are building Class-A are always going to push the square footage of the building. You’re not going to leave a lot of room for trailer parking on the site.”

Muir said new supply is also constrained by community NIMBYism and municipalities reluctant to approve projects that focus on large numbers of trucks on local roads.

“The lack of the supply of this zoning that allows for truck parking, you can’t just buy a warehouse and park trucks there. You have to have special zoning,” Muir said. “Very few places have the zoning. You got this massive increase in demand and the supply is incapable of growing. It’s going in the opposite direction.”

dayton street partners (dsp) signs a long term lease at their newly acquired truck terminal in charlotte nc

January 20, 2022 - daytonstreetllc.com

Dayton Street Partners (DSP) is pleased to announce it has executed a long term lease with FEDEX Ground Package Systems at their recently acquired truck terminal in Charlotte, NC. The 94 door terminal sits on 14 acres and has a 15 bay maintenance facility. Many thanks to our broker, Tom Tropeano of Avison Young and Curt Starr and James Cant of Fischer and Co who represented FEDEX in this transaction.

Dayton street partners brings chicago logistics park to 100 percent occupancy

January 14, 2022 - rejournals.com

Dayton Street Partners has signed two leases totaling 29,326 square feet at its three-building logistics park at 2217 S. Loomis St. in Chicago.

Meade, Inc., signed on for 25,326 square feet while Central States Trucking leased about 4,000 square feet on three acres. Both companies cite 2217’s direct access to I55/94, the city’s high-density neighborhoods and robust logistics infrastructure as drivers for their respective site selection decisions.

The transactions bring the property to 100 percent leased.

2217 S. Loomis St. offers significant parking for trailers and fleets and significant outdoor storage space, as well as a separate office/showroom and a truck scale. Two of the buildings provide full pull-through access via grade level overhead doors on a 100% concrete covered and secured site.

Located on the southeast corner of South Loomis St. and West Cermak Rd., the property provides unparalleled access to the state’s vast interstate infrastructure as well as the CBD. It is approximately one mile north of I-55 and one mile west of I-90/94, two miles from I-290 and three miles from downtown. It occupies a spot in an excellent distribution pocket that is home to other LTL carriers, trucking companies, distributors and manufacturers such as Amazon, FedEx, Lineage Logistics, Fastenal, Sherwin Williams, Carmichael Trucking and Brandenburg Industries.

CBRE’s Kevin Segerson and Philip A. DeBoer represented Forward Air in the transaction while Peter Poulos with Peter J. Real Estate represented Meade.

Dayton Street, one of the most active investor/developers in the U.S., focuses on the acquisition and development of high barrier to entry infill industrial and office properties across the country. The firm continues to grow its business and recently expanded its portfolio with logistics related acquisitions in the Southeast including assets in Miami, Orlando, Nashville, Charlotte, Tampa, Houston, and California’s Central Valley.

this week’s chicago deal sheet

January 11, 2022 - bisnow.com

Dayton Street Partners, a Chicago-based real estate investment and development firm, signed two leases totaling 29K SF in its three-building logistics park at 2217 South Loomis St. in Chicago. Meade signed on for 25K, and Central States Trucking, a division of Forward Air, leased about 4K SF on 3 acres. The transactions bring the property to 100% leased. CBRE’s Kevin Segerson and Philip DeBoer represented Forward in the transaction, while Peter Poulos with Peter J. Real Estate represented Meade.

Atlanta’s warehouses have become ‘the belle of the ball’ for wall street giants

January 10, 2022 - Bisnow.com

Investment into Metro Atlanta’s industrial market has gone into overdrive, and there is no better piece of evidence than the sheer amount of money flowing through warehouses in the area.

Roughly $5.4B worth of industrial properties centers traded hands in 2021 in the region, according to data compiled by Colliers Atlanta, more than twice the previous volume record of $2.69B, set in 2019.

The surge in demand and lack of enough properties to satisfy it has driven values skyward: Metro Atlanta’s industrial properties sold for a record average of $89.18 per SF last year. The price of industrial space has nearly doubled over the past five years - in 2016, properties traded at an average of $48.47 per SF.

“I’ve never experienced in my career a better landscape for operating fundamentals, which has translated to the highest demand from investors and pricing,” said CBRE Vice Chairman Chris Riley, who has been in industrial investment broker since 1987. “It’s nice to be in a sector that is the belle of the ball.”

James Pitts, a principal with Greenwood Commercial Real Estate Group in Atlanta, was scouting properties for a client looking to buy Atlanta industrial, and he came upon a 50K SF warehouse north of Atlanta that had delivered just two days earlier.

But he was 48 hours too late. By then, Pitts said, the builder already was in agreement to sell to one buyer and had four others on backup in case that one fell through.

“[The developer] literally laughed at me and said, ‘Good luck finding something up this way, “ Pitts said.

Such is the current climate in Atlanta’s industrial market, whose fundamentals are inviting to new, large players who are shelling out previously unheard-of sums for warehouses and distribution centers.

In 2021, the region’s industrial market saw more than 42M SF of net new absorption, eclipsing the previous record of 25.9M SF in 2017. Warehouse rents have risen from $3.40 per SF in 2021 to more than $5.30 per SF at the end of 2021, according to Marcus & Millichap.

That growth has attracted the biggest names on Wall Street to properties that were once afterthoughts. Goldman Sachs made the largest single industrial asset purchase in Atlanta last year, paying $134M in August for nearly 1M SF Kraft Heinz warehouse in Union City from Blackstone, which had purchased it six months earlier for $109.8M, the Atlanta Business Chronicle reported.

Private equity giant KKR purchased two 1M SF warehouses for over $100M each: Palmetto Logistics Center in Coweta County from Artemis Real Estate Partners and PNK Park Southern Gateway in McDonough for $103M from PKN Group.

More recently, Brookfield purchased 550 Rock Hill Drive, a 180K SF distribution center in the Hartsfield-Jackson Atlanta International Airport submarket from Chicago-based Dayton Street Partners. While the price was undisclosed, a source familiar with the transaction said it sold for $19.5M or $108 per SF.

Buyers have been hungry for industrial real estate since before the pandemic, but widespread adoption of online shopping and supply chain disruptions have led to a nationwide crunch for distribution space.

Industrial property sales hit a high watermark in 2019 at $118B across the U.S., according to Real Capital Analystics. That moderated some to a little more than $100B in 2020 because of the pandemic, but capital has come roaring back into the industrial sector, pushing prices well above pre-Covid levels.

“It’s very much a traders’ market,” said Riley, who added that his national industrial brokerage team at CBRE tallied a record year in 2021 with $32B in sales. “[Investors] are paying up for everything.”

Institutional and global buyers have expanded their geographic nets when searching to buy industrial properties. Before Covid, they would focus on buying warehouses in the top 30 markets in the U.S., Riley said, but today that number has doubled.

“There’s a lot of money chasing deals, and industrial is a preferred asset class, for sure,” Marcus & Millichap First Vice President John Leonard said. “That’s the market.”

All of the competitors in the market have put the squeeze on cap rates, which have a marketwide average of 6.7%, but the strongest Atlanta properties are selling for cap rates below 3%, according to Marcus & Millichap.

“Appreciation is off the charts. You can do nothing to a property, cap rate compression is providing additional equity with not a lot of improvements,” Leonard said. “If you’re thinking about selling something in the next two to five years, I don’t know why you would wait.”

Despite some 43M of new construction underway - nearly twice the amount of space delivered in Metro Atlanta in 2021 - few are projecting price growth to fall back to historical norms.

While the investment demand for industrial space has developers and owners celebrating, Pitts said it has made it difficult for companies to find real estate at reasonable prices if they want to buy their own facilities. Many smaller companies are getting outbid by investors with deeper pockets.

“We have some smaller clients who want smaller industrial spaces closer into the city. But everything that says industrial is expensive right now,” Pitts said. “I don’t think it makes sense to purchase right now. I think you should lease and wait.”

dayton street partners acquires 7.7-acre storage yard in chicago

January 6, 2022 - rejournals.com

Dayton Street Partners (DSP), a Chicago-based real estate investment and development firm, today announced it has acquired a trailer parking and storage facility located at 4900 S. Merrimac Ave. in Chicago.

DSP has already begun to transform the 8-acre infill site, having leveled two existing structures in order to make way for 237 truck trailer stalls. When complete the site will be fully lit and fenced with a motorized gate.

The property is strategically located with direct access to I-55 and adjacent to the CN Rail Yard. Numerous transportation-oriented tenants that need access to the multiple local intermodal yards, city, its airports and supply chain infrastructure.

“These well-located properties that offer above standard fleet parking are critical for today’s industrial users,” said DSP’s Founder and Managing Principal Howard Wedren.

NAI Hiffman’s Kelly Disser, Michael Freitag and Ben Ryan represented DSP in the Acquisition.

DSP, one of the most active investor/developers in the U.S., focuses on the acquisition and development of high barrier to entry infill industrial and office properties across the country. The firm continues to grow its business and recently expanded its portfolio with logistics related acquisitions in the Southeast including assets in Miami, Orlando, Nashville, Charlotte and Tampa. Earlier this year Dayton Street broke ground on two new logistics facilities in Atlanta and Houston and Stockton, CA.

dayton street adds fleet parking on south side

January 5, 2022 - connectcre.com

Dayton Street Partners (DSP) has acquired a trailer parking and storage facility located at 4900 S. Merrimac Ave. in Chicago’s South Side. The price wasn’t disclosed.

DSP has already begun to transform the eight-acre infill site, having leveled two existing structures to make way for 237 truck trailer stalls. When complete the site will be fully lit and fenced with a motorized gate.

The property is strategically located with direct access to I-55 and adjacent to the CN Rail Yard. Numerous transportation logistics related companies are nearby such as FedEx Freight, Hub Group, ABF Freight and Old Dominion Freight Line.

“These well-located properties that offer above-standard fleet parking are critical for today’s industrial users,” said Howard Wedren, DSP’s founder and managing principal. DSP expects interest from a variety of logistics and/or transportation-oriented tenants.

NAI Hiffman’s Kelly Disser, Michael Freitag and Ben Ryan represented DSP in acquisition.

NEWMARK BROKERS LAND SALES TO DAYTON STREET PARTNERS

December 20, 2021 - connectcre.com

Newmark closed the sale of three assembled land sites totaling 42 acres in Portage, IN. Senior managing director Corey B. Chase and associate Chris Hill represented the undisclosed sellers in the sale to Chicago-based industrial and logistics developer Dayton Street Partners (DSP).

DSP plans to begin speculative development of 538,000 square feet of warehouse/distribution space on the site, known as DSP Crossroads Portage. Chase and Hill will be retained to market the future spec space for lease or sale on behalf of DSP.

“Industrial demand in the Chicagoland area- particularly for logistics and distribution product- in combination with lack of available land and rising development costs, are all factors attracting developers to Northwest Indiana,” said Chase. “DSP’s investment in this future industrial park is incredibly thoughtful and strategically timed. We look forward to our continued work on the project in partnership with DSP and congratulate them on a successful transaction.”

DSP TRADES MORTON GROVE WAREHOUSE TO BROOKFIELD

December 13, 2021 - connectcre.com

Dayton Street Partners (DSP) has sold a 208,000-square-foot distribution center at 6123 Monroe Ct. in Morton Grove, IL, to Brookfield Property Group for an undisclosed price.

“This was a rare opportunity for an investor to acquire a stabilized, infill distribution center,” said Howard Wedren, DSP’s founder and managing principal.

DSP acquire the property in 2016 and immediately launched a multimillion-dollar interior and exterior renovation campaign, converting the antiquated industrial facility into an institutional quality distribution center. The Chicago-based owner/developer updated the facade, repaved the parking lots, installed a new roof and added new signage.

The facility now sports 28’ clear warehouse space, 17 loading docks, three drive-in doors, parking for 150 cars and 1.5 acres of trailer parking. At closing it was 100% leased to five tenants.

CBRE’s Michael Caprile, Zach Graham and Ryan Bain represented DSP in the sale to Brookfield.

conor commercial real estate and dayton street partners to develop 1.1 million square feet in stockton, ca

October 5, 2021 - prweb.com

Central Industrial Center is a three-building, 1,090,160-square-foot industrial development located in Stockton, California.

IRVINE, CALIF. (PRWEB) OCTOBER 4, 2021

The co-development team of Conor Commercial Real Estate and Dayton Street Partners, along with their partner, an affiliate of Heitman LLC (Heitman), a global real estate investment management firm, have announced the development of Central Industrial Center. Located in Stockton, California, the new Class A industrial development will incorporate three speculative buildings totaling 1,090,160 square feet. Conor acquired the 56-acre site from Ingredion in April 2021. Jason Schulz and Rich Schulz of the J. Rich Company represented Ingredion in the sale.

“We’re very excited to get started on this project,” shared Sven Tustin, Executive Vice President at Conor. “We selected a site and design for Central Industrial Center that we knew would provide a number of logistical advantages for users. In addition to building configurations designed to meet the needs of a variety of users, the site provides access to multiple modes of transportation.”

The sizable development will incorporate three buildings of varying sizes. Building 3, the largest of the buildings, will incorporate 833,280 square feet in a cross-dock configuration with a 40’ clear height, 50’ x 60’ column spacing, 141 dock doors, four drive-in doors, 310 parking spaces and 198 trailer stalls. Building 2 is a 121,680-square-foot front load facility with a 32’ clear height, 50’ x52’ column spacing, 25 dock doors, two drive-in doors, 76 parking spaces and 26 trailer stalls. Building 1 is a 135,200-square-foot front load facility that will offer a 32’ clear height, 50’ x 52’ column spacing, 28 dock doors, two drive-in doors, 76 parking spaces and 24 trailer stalls. All three buildings will provide skylights, ESFR sprinklers, high-capacity natural gas and electrical infrastructure, 60’ speed bays and office space to suit. Each building has been designed to accommodate a multi-tenant configuration as small as 60,000 square feet.

Positioned on a 56-acre infill site in the city of Stockton, Central Industrial Center will offer close proximity to Interstate 5 and Highway 99. Additionally, it is located immediately north of Stockton Metropolitan Airport, a major cargo hub for several shipping companies, and adjacent to both Union Pacific and BNSF rail yards with track stubbed to the property.

The design-build team of McShane Construction Company and Ware Malcomb are providing comprehensive construction and architectural services for Central Industrial Center. An August 2022 completion is expected.

are transload facilities the next frontier in the industrial investment racE?

August 19, 2021 - wealthmanagement.com

Truck terminals and transload yards are essential to supply chain efficiencies. Investors are beginning to notice.

The growing logistics industry has not only created insatiable demand for warehouse space, it has ramped up growth in the transportation industry, creating a need for modern truck terminals with high-volume flow-through facilities. Commercial real estate investors are beginning to take notice and are allocating more of their money to this niche sector.

“Historically, investors in truck terminals were large trucking companies that wanted to own their own facilities, like Old Dominion ABF, SAIA, R&L, Carriers, Central Transport and ESTES,” says Dean Brody, executive managing director and specialist in this investment area with real estate services firm JLL. Today, this sub-sector is attracting big institutional investors and industrial real estate developers/investors. These include Centerpoint, Realterm Logistics, Terreno Realty, Brookfield, Duke Realty, Prologis, Stonemont, Altera, JP Morgan and others that have recently entered this market. Speculative development may not be far behind.

For example, in April, Chicago-based Dayton Street Partners acquired a 17,897-sq.-ft. truck terminal near Tampa International Airport in Florida from a private investor for an undisclosed price. The property is 100 percent leased to ABF Freight. “This was a great opportunity to capitalize on increasing demand in the market and is part of a larger corporate strategy to invest in well-located, logistics-related real estate assets in Florida and throughout the U.S.,” said DSP Principal Michael Schack in a statement.

Integrated Service Provider (ISP) facilities are essential to supply chain efficiencies, Brody notes. Amid higher transportation costs and driver shortages, the need for them has been growing over the past 15 years. The ecommerce boom has accelerated demand for those facilities by multiples, Brody says.

“The purpose for these buildings is either redirecting cargo mode-usually from container to truckload-or consolidating and redirecting freight direction and what freight rides together,” according to John Morris, executive managing director and Americas industrial and logistics leader with real estate services firm CBRE.

De-containerizing cargo and transloading it onto trucks or rail cars facilitates logistics efficiencies, according to Brody. He explains, for example, that cargo from three 40-foot containers can fit into two 53-foot truck trailers, and it is more cost-effective for those trucks to deliver the cargo that directly transporting it over 50 miles to the final destination because the empty containers then must be returned to the origination point.

Markets that see the heaviest cargo movements have the highest demand for these functionalities, Morris notes. For example, there is a significant density of transload buildings in South California’s Inland Empire, where cargo is often moved from the ports of Los Angeles or Long Beach, Calif. because it costs less to de-containerize it there than closer to the ports. “Containers coming in from China are dray-moved to these buildings, de-containerized into different trucks or rail cars and moved out to mostly points further east from there,” Morris says.

The fee revenue models for these facilities are similar to any real estate tenancy-users typically own or lease them, according to Morris. However, many are also third-party facilities, where users are charged through a 3PL arrangement that is a blend of fixed and variable costs. Brody notes that pricing is on a per-door, per-month triple-net basis.

ISP’s are located in logistics hubs all over the country. Those near intermodal facilities and ports will have transload options, Brody says, noting that terminals in infill locations in places like Northern New Jersey, New York City outer boroughs, Chicago, Seattle, the San Francisco Bay area, Los Angeles and the Inland Empire are achieving the highest rents.

ISP property values are dependent on location, but cap rates on these assets tend to be average 1.5 percent higher than those for class-A warehouse properties, according to Brody. He notes that the spread is narrowing in core markets, where cap rates on ISP assets are now only 50 basis points to 100 basis points higher than for a warehouse, or might even be the same.

While returns on investment for ISP facilities are lower than those for warehouse properties, Morris says that they are marginally less expensive to develop, as transloading buildings to not require much clear height, and their structures typically do not need to support heavy automation. Such buildings also have a lower coverage ratios, typically about one-tenth of the site, but they do require a lot of land to accommodate the higher number of axles travelling in and out than a traditional warehouse does.

ISP’s, which are basically concrete yards with a transloading facility, haven’t changed much over the last 50 years, except modern facilities have 100-foot dock doors as opposed to 70 to 90-foot doors found in older facilities, to provide greater flexibility in movement, Brody says.

Cities generally don’t allow the development of ISP facilities near large population centers, as they have several negative aspects: they are aesthetically unattractive and inherently involve heavy truck traffic and significant CO2 emissions. Therefore, Brody notes that there is tremendous value in land already zoned for ISP’s.

Despite high demand for these facilities, they have traditionally been developed on a build-to-suite basis for single-tenant users, such as large Fortune 100 retailers or third-party logistics providers, including Fedex, UPS, XPO and National Retail Systems. But going forward, Brody expects that spec developers will soon begin capitalizing on the growing need for ISP buildings.

Dayton street partners acquires land in northwest indiana, plans 538,038 sf spec industrial project

July 23, 2021 - rebusinessonline.com

PORTAGE, IND - Dayton Street Partners LLC has acquired a 42-acre site in Portage with plans to develop a three-building speculative industrial project spanning 538,038 square feet. The development will be known as DSP Crossroads Portage. Corey Chase and Chris Hill of Newmark represented the undisclosed seller. Upon closing, the duo will be retained to market the buildings for lease or sale on behalf of Dayton Street. A timeline for construction was not released.

industrial real estate market analysis with joe moriarty of dayton street partners

May 11, 2021 - realestatebreakfast.com

Today on Real Estate for Breakfast, host Phil Coover and his co-host Jay Augustyn are joined by Joe Moriarty of Dayton Street Partners LLC (Dayton Street), a commercial real estate investment and development firm focused on the acquisition and development of high barrier to entry infill industrial and logistics properties.

On the podcast, Joe shares Dayton Street’s current investment thesis and passion for challenging development projects. Joe discusses Dayton Street’s pursuit of industrial development projects outside of the Chicagoland area and the process by which the Dayton Street team cultivates relationships with key constituencies in the new markets. Joe then shares this thoughts on why he remains bullish on industrial and logistics facility development as we approach living in a post-pandemic world.

PLAY “Industrial Real Estate Market Analysis with Joe Moriarty of Dayton Street Partners”

Joe Moriarty is a Director of Acquisitions at Dayton Street, where he is responsible for sourcing industrial real estate acquisitions and land for development opportunities. He co-heads the firm’s acquisitions efforts throughout the Midwest, while also focusing on Atlanta and the greater Southeast. Prior to joining Dayton Street, Joe worked in the Capital Markets Group at JLL where he specialized in office transactions. Joe began his career in 2013 as an analyst for GE Capital Real Estate and graduated with a degree in finance from the University of Kansas.

dayton street partners acquires 41 dock door, 17,897 sf truck terminal in tampa, fl

April 6, 2021 - Daytonstreetllc.com

TAMPA, FL (April 6, 2021) - Chicago-based Dayton Street Partners (DSP) has acquired a truck terminal located at 3725 E. Martin Luther King Blvd. in Tampa, FL, from a private investor. The sale price was not disclosed.

“This was a great opportunity to capitalize on increasing demand in the market and is part of a larger corporate strategy to invest in well-located, logistics related real estate assets in Florida and throughout the U.S.,” said DSP Principal Michael Schack.

Strategically located near I-4, I-75, I-275 and Tampa International Airport, the 17,897-square-foot truck terminal/warehouse sits on 5.1 acres and features 41 dock doors. There is also a standalone two bay maintenance garage. The property provides abundant parking with approximately 164 trailer stalls, parking for 26 cards, and is fully fenced and lit. It is 100% leased to ABF Freight.

Added Schack, “Strong market fundamentals and continued population growth make Tampa one of DSP’s target markets for additional investment.”

Despite the pandemic, DSP continues to grow its business and recently expanded its portfolio with the groundbreaking of DSP Rock Hill, a 180,000-square-foot speculative distribution center at Atlanta’s Hartsfield International Airport, the acquisition of a 60 dock truck terminal at 6501 Harney Rd. in Tampa and the acquisition of a 61 dock truck terminal in Hollywood Florida at 3811 Pembroke Rd.

Will McFarlin with Burr & Temkin represented the Seller in the transaction.

Brookfield properties acquires chicago distribution center

March 8, 2021 - GlobeSt.com

Brookfield Properties has purchased a distribution center in Chicago, IL from the Chicago-based logistics real estate investment and development firm, Dayton Street Partners.

The 41,000-square-foot, last -mile distribution facility, located at 4150 N. Knox Ave. on Chicago’s North Side, was acquired for an undisclosed price.

Fully leased to Johnstone Supply and Goodman Manufacturing, the distribution center features 30-foot clear ceiling heights, six docks, four drive in doors, LED lighting and 55 parking spots.

Dayton Street Partners originally acquired the 1.6-acre vacant parcel in 2015, prior to completing construction on the warehouse in 2018.

CBRE national partners represented Dayton Street Partners in the transaction.

Dayton Street Partners recently acquired a 500,000-square-foot, 95-acre transload facility in Houston, TX, and also recently broke ground on a 180,000-square-foot speculative distribution center at Atlanta’s Hartsfield International Airport.

DAYTON STREET Partners acquires 7.81-acre industrial site in chicago

February 25, 2021 - REJournals.com

Dayton Street Partners has acquired a 7.81-acre site with multiple high flow-through buildings totaling 66,154 square feet at 2217 S. Loomis St. in Chicago. The seller was Southfield Corporation.

2217 S. Loomis St. is unique in that two of the buildings provide full pull-through access via grade level overhead doors on a 100 percent concrete-covered and secured site. The property also features a separate office/showroom and a truck scale.

Located on the southeast corner of South Loomis Street and West Cermak Road, the property provides access to the state’s vast interstate infrastructure as well as the CBD. It is about one mile north of I-55 and one mile west of I-90/94, two miles from I-290 and three miles from downtown.

In addition, 2217 S. Loomis St. occupies a spot in an excellent distribution pocket that is home to other LTL carriers, trucking companies, distributors and manufacturers. Neighborhood tenants include Amazon, FedEx, Lineage Logistics, Fastenal, Sherwin Williams, Carmichael Trucking and Brandenburg Industries.

Dayton Street expects interest from users that require direct access to the city’s high-density neighborhoods. Given the property’s 19 percent site coverage, the company also expects to attract users that require significant trailer/van/fleet parking and/or outdoor storage.

“This was a great opportunity to capitalize on increasing demand in the market and is part of a larger corporate strategy to invest in well-located, logistics related real estate assets in Chicago and across the U.S.,” said Howard Wedren, Dayton Street founder and managing principal.

David Lane of Burr and Temkin, along with Ed Wabick, Terry Lynch and Marc Hale of Paine Wetzel, will lead the marketing and leasing efforts.

DAYTON STREET MAKES LOGISTICS BUY ON CHICAGO’S SOUTH SIDE

February 24, 2021 - Connectcre.com

Chicago-based Dayton Street Partners has acquired a 7.81-acre site with multiple high flow-through buildings totaling 66,154 square feet at 2217 S. Loomis St. on Chicago’s South Side. The seller was Southfield Corporation.

2217 S. Loomis St. is unique in that two of the buildings provide full pull-through access via grade level overhead doors on a 100% concrete-covered and secured site. The property also features a separate office/showroom and a truck scale.

Dayton Street expects interest from users requiring direct access to Chicago’s high-density neighborhoods. Given the property’s 19% site coverage, the company also expects to attract users requiring significant trailer/van/fleet parking and/or outdoor storage.

“This was a great opportunity to capitalize on increasing demand in the market and is part of a larger corporate strategy to invest in well-located, logistics-related real estate assets in Chicago and across the U.S.,” said Howard Wedren, Dayton Street founder and managing principal.

houston continues its reign as logistics hub

January 13, 2021 - GlobeSt.com

HOUSTON - As a fast-growing US logistics hub, Houston is top target for Chicago-based Dayton Street Partners. So much in fact that DSP has entered the Houston market with the acquisition of 5800 Mesa Dr., a 500,000-square-foot logistics property featuring a 333-door truck terminal and a 33-bay maintenance facility on a 90-acre site. The seller was a private investor and the price was undisclosed.

“This was a great opportunity to capitalize on increasing demand in the market and is part of a larger corporate strategy to invest in well-located, logistics-related real estate assets in Texas and throughout the US,” said Howard Wedren, DSP founder and managing principal.

DSP plans a multi-million-dollar renovation of the terminal and the development of 25 acres of fully improved, lighted and secured trailer parking. This type of property continues to be in high demand in the area and in other major US markets.

Located just south of I-610 and less than 10 miles from the Port of Houston and Houston’s CBD, 5800 Mesa Dr. is situated in Houston’s transportation and logistics corridor which is home to several LTL carriers, trucking companies, distributors and manufacturers. Neighborhood tenants include SAIA, Estes Express, Lineage Logistics, Southwest Freight, JB Hunt, Knight Transportation, Rush Truck Centers, Tyson Foods and Kroger.

“Houston’s industrial market ended the year on a strong note with record-breaking completions,” say Drew Coupe, a vice president in Avison Young’s Houston office specializing in industrial tenant representation. “Supply surplus has given tenants an advantage as landlords continue to offer enticing concession packages with up to 10-month rent abatements on long-term deals, plus allowances for tenant improvements.”

Despite the pandemic, DSP continues to grow its business and recently expanded its portfolio with the groundbreaking of DSP Rock Hill, a 180,000-square-foot speculative distribution center at Atlanta’s Hartsfield International Airport, and the acquisition six logistics-related acquisitions in the Southeast including assets in Miami, Orlando, Nashville, Charlotte and Tampa. The firm will continue to seek out properties in Texas and across the country that fall in line with the investment strategy.

“Dayton Street will continue to seek opportunities in the Southeast, Southwest and Texas as these areas continue to see exponential growth in population as well as logistics infrastructure development,” Wedren tells GlobeSt.com.

investment firm dayton street partners acquires industrial property in Houston

January 5, 2021 - Houston Business Journal

A Chicago-based real estate investment firm has made its first local property purchase with the acquisition of a 500,000-square-foot logistics center in northeast Houston.

Dayton Street Partners paid an undisclosed amount to acquire 5800 Mesa Drive and is planning to invest in a complete renovation of the structure, according to a news release.

While the terms of the deal were not disclosed, including the name of the seller, the property was valued at $858,014 as of Jan. 1, 2020, according to Harris County Appraisal District records.

“As a fast-growing U.S. logistics hub, Houston is a top target for us,” Dayton Street Partners Managing Principal Howard Wedren said in a statement. “This was a great opportunity to capitalize on increasing demand in the market and is part of a larger corporate strategy to invest in well-located, logistics-related real estate assets in Texas and throughout the U.S.”

5800 Mesa Drive, which is off of U.S. Highway 90 Business northeast of the Interstate 610 Loop, came equipped with a 333-door truck terminal and a 33-bay maintenance facility on a 90-acre parcel of land.

Dayton Street Partners is planning a multimillion-dollar renovation of the terminal, as well as the development of 25 acres, which will be used for improved, lighted and secured trailer parking. The company said it has seen a growing demand for trailer parking both in Houston and in other major markets in the United States.

Dayton Street Partners said it plans to continue seeking out investment opportunities in Houston as well as the rest of Texas.

Even amid the Covid-19 coronavirus pandemic, Houston’s industrial properties have remained in high demand over the past year.

During the third quarter of 2020, just over 1 million square feet of industrial space was absorbed in Houston, bringing the year-to-date absorption total to 7.5 million square feet. In all, about 18.5 million square feet of industrial space has been delivered in 2020, according to a recent report by Los Angeles-based CBRE (NYSE:CBRE).

And there are a few signs that the industrial sector is going to slow down anytime soon.

“Market observers expect companies looking for space will continue to seek new product,” CBRE said. “Additionally, historically low interest rates are creating new opportunity for owner-occupier building purchases.”

Chicago firm acquires site for first development project in atlanta

December 11, 2020 - Costar

Dayton Street Partners is making its first foray into the Atlanta market with the acquisition of a site in Riverdale, Georgia, where the company plans to develop a speculative distribution hub.

The firm acquired 12.6 acres at Rock Hill Drive and Georgia Highway 85 for the future site of the Rock Hill Distribution Center, a 180,300-square-foot facility located just south of Hartsfield-Jackson Atlanta International Airport. The complex broke ground this week and is expected to be completed in the third quarter of 2021.

The Chicago-based real estate developer had been looking to make the leap into Atlanta since early last year as part of its expansion into the Southeast. For its first Atlanta investment, the firm created as assemblage of vacant land parcels and former residential properties for the site of Rock Hill Distribution Center, acquiring the land from an individual investor for a little more than $1.48 million, or nearly $118,000 per acre.

The tract represents one of the last developable sites in the submarket and an opportunity to develop a distribution center that caters to the requirements of today’s users, Dayton Street Partners said in a statement. The facility has been designed to feature 32-foot clear heights, a high dock door count and an ESFR sprinkler system.

Joe Moriarty, director of acquisitions at Dayton Street Partners, said the firm is actively pursuing additional development and acquisition opportunities in the area.

Lee & Associates assisted Dayton Street Partners and is marketing Rock Hill for lease on behalf of the developer.

See Additional Articles Regarding Rock Hill Distribution Center

CHICAGO BUSINESS JOURNAL : https://www.bizjournals.com/chicago/news/2020/12/10/dayton-street-partners-atlanta-market.html

ATLANTA BUSINESS CHRONICAL : https://www.bizjournals.com/atlanta/news/2020/12/09/dayton-street-partners-atlanta-market.html

CONNECT MEDIA : https://www.connect.media/dayton-street-partners-to-develop-180k-sf-distribution-center-in-metro-atlanta/

chicago developer dayton street partners enters Atlants’s industrial real estate market

December 9, 2020 - Bizjournals.com

A Chicago real estate developer has started construction on a distribution center near Atlanta’s airport, its first project in the metro area and another example of confidence in the region’s booming logistics sector.

This week Dayton Street Partners broke ground on the 180,300-square-foot building rising on 13 acres it assembled south of Hartsfield-Jackson Atlanta International Airport on Rock Hill Drive. Rock Hill Distribution Center, as the project is called, is slated to be finished by the third quarter of 2021.

Dayton Street declined to say how much it paid for the land, and the transaction was not immediately available in the public deeds.

Atlanta commercial real estate services firm Lee & Associates was tapped to market the distribution center for lease.

Dayton Street and other developers expanding in Atlanta see demand driven by consumers who are turning more than ever to online shopping, especially during the pandemic. An industry rule-of-thumb is that for every $1 billion in e-commerce sales another 1.2 million square feet of new e-commerce space is needed. Consider longtime Atlanta developer Portman Holdings just launched an industrial division. Another area of growth among industrial properties is within the cold-storage industry, where the largest giants are gobbling up other companies in a bid to build global logistics networks.

DSP was a major player in office space in its hometown but in recent years moved to industrial property investments. Earlier this year the company bought distribution centers around Chicago O’Hare International Airport. More private equity is being sunk into the industrial property sector across the country, a trend underpinned by the growth of ecommerce.

Online retail giant Amazon.com is building its fullfillment engine across Atlanta and is the biggest player in a profound and wider shift in the way Americans consume goods and services. In the past 20 years, ecommerce has grown from less than 1% to over 16% of total retail sales in the U.S., according to The Brookings Institution.

Covid-19’s impact on the food, beverage and logistics industries is also resulting in demand for cold storage warehouses for food storage and potentially for vaccines. Distribution centers are needed to hold the vast increase of goods bought online in recent years, especially during 2020 as people were forced to stay home to slow the spread of the coronavirus. This year, ecommerce sales jumped 32% from the first quarter to second quarter. At the same time, overall retail sales decreased 4%.

A recent report by Newmark Knight Frank, an Atlanta commercial real estate firm, said industrial properties appear to be the best positioned to get through the Covid-19 economic downturn in Atlanta and across the country.

Dayton street partners promotes joe moriarty to director - acquisitions

February 3, 2020 - RE journals

Dayton Street Partners, a Chicago-based industrial and logistics real estate investment firm, announced that Joe Moriarty has been promoted to director - acquisitions. As such, Moriarty will play a larger role in sourcing commercial real estate projects for the firm.

“Joe continues to impress our team with his ability to find and analyze transactions that deliver value to our portfolio and returns to our investors,” said Dayton Street managing principal Howard Wedren.

Moriarty joined Dayton Street in 2018 as an associate/acquisitions analyst responsible for underwriting prospective deals. He began his career at JLL and is a graduate of the University of Kansas.

“I look forward to playing a key role in expanding Dayton Street’s investment presence nationally and to growing our industrial and logistics real estate portfolio overall,” said Moriarty.

Dayton street partners adds two elk grove properties to its portfolio

January 31, 2020 - RE journals

Chicago-based Dayton Street Partners has closed on two industrial properties in Elk Grove Village, Illinois. The properties, at York and Elmhurst Roads, are situated directly across the street from Chicago O’Hare International Airport and offer direct access to O’Hare’s south cargo entrance via York Road and East Irving Park Road. The interstate system is immediately accessible to the north and south of the properties.

First, Dayton Street acquired 2454 Elmhurst Road. Built in 1982 on 1.3 acres, the 16,473-square-foot warehouse features 4,900 square feet of office space, five exterior docks and two drive-in doors. It is 100 percent leased to Crown Roll Leaf and Associated Builders and Contractors.

The firm also purchased 2500 York Road. The 55,356-square-foot warehouse sits on 3.3 acres and features two interior docks and three drive-in doors. Ceiling height ranges from 24- to 36-foot clear. Dayton Street renovation plans include exterior painting, new LED lighting and selective demolition. One of only a few crane-served properties in the O’Hare submarket, it has two five-ton and two two-ton cranes.

“The O’Hare market remains very strong and we are very excited about our continued growth,” said Dayton Street’s executive vice president, Michael Schack.

Dayton Street just wrapped up two spec developments in the area: a 132,270-square-foot distribution center in Mount Prospect, Illinois and a 116,00-square-foot speculative distribution center in Bensenville, Illinois.

Dayton street signs vienna beef’s headquarters

January 8, 2020 - Crain’s Chicago Business

Dayton Street Partners signed a long-term lease with Vienna Beef’s Headquarters for all of 2501 W. Fulton Street, a nearly 40,000 square-foot building. Dayton Street has renovated the building’s interior warehouse and built out 8,000 square feet of office space. Vienna Beef will bring its 127-year-old company and prominent Chicago food brand to a corridor running west of Ogden Avenue between Lake Street and Grand Avenue that is rife with industrial companies like it. Dayton Street was represented by JLL’s Scott Duerkop and Dominic Carbonari.

Dayton street signs ardmore roderick

March 12, 2019 - Bisnow

Dayton Street Partners signed Ardmore Roderick, an engineering firm, to a 13K SF headquarters lease - the entire third and fourth floors - at 1500 West Carroll Ave. in Chicago’s burgeoning Fulton Market West. Dayton Street recently completed a $4M renovation of the six-story, 38K SF loft office building. Improvements included new exterior windows, new bathrooms, a new HVAC system, new lighting and refreshed stairwells. The Chicago-based developer also added a modern lobby, a rooftop deck with skyline views, a bicycle garage and parking for 42 cars. Ardmore joins Via Tecknik, Limitless Coffee, Neato Agency and Breather, which all recently signed leases in the building. Dayton Street was represented by JLL’s Mike Curran and Mark Georgas.

Dayton street makes first indianapolis buy

December 18, 2018 - Connect Chicago

Chicago-based Dayton Street Partners has acquired a 142,000-square-foot industrial building in Indianapolis, IN. Pricing and seller were not disclosed.

Built in 1991 and strategically located near Indianapolis International Airport and downtown Indianapolis, 2513-2515 So. Holt Rd. recently underwent a $1.5 million renovation. The building is fully-leased to Covanta Holding Corporation, which houses its non-hazardous liquid treatment business on-site.

“This transaction represents Dayton Street’s first strategic acquisition in Indianapolis,” said DSP managing principal Howard Wedren. “It falls in line with our niche of acquiring value-add, high-barrier to entry institutional quality assets.”

Josh Joseph, Matt Tarshis and Andrew Rubin of Frontline Real Estate Partners represented the seller in the transaction.

FULTON mARKET tRANSFORMATION SHOWS SIGNS OF CREEPING WESTWARD

September 28, 2018 - Crain’s Chicago Business

The next big developer land grab in Chicago is starting to take shape, but whether it escalates into an investor stampede is up to City Hall.

Now that the developers who set off the transformation of the Fulton Market District are staking claims along Ogden Avenue—the western zoning boundary of the gritty-turned-trendy neighborhood—the city is turning its attention westward to determine the next steps in the fast-changing corridor's development path. And real estate investors are ready to pounce.

City planning officials are expected Oct. 9 to share publicly their vision for the Kinzie Industrial Corridor, which runs west from Ogden between Lake Street and Grand Avenue in a long-standing planned manufacturing district that is catching the eyes of prominent real estate investors as activity in Fulton Market surges west.

The city is mulling whether the neighborhood—known as Fulton Market West by some stakeholders that want to share in the area's spotlight—should follow the lead of the popular district to its east and allow new uses like offices, retail and others that are generally prohibited in a PMD. Repealing the PMD that governed the Fulton Market District led to the neighborhood's rapid transformation and the arrival of corporate giants like Google and McDonald's as well as high-end hotels and restaurants. Mayor Rahm Emanuel's administration has taken a similar approach to modernizing the historically industrial corridor along the North Branch of the Chicago River near Lincoln Park.

Created by Mayor Richard M. Daley to protect industrial jobs on the Near West Side, the Kinzie Corridor PMD will remain in place, says 27th Ward Ald. Walter Burnett, "but some parts are going to be more lenient than other parts." The zoning will generally be relaxed in the eastern portion of the corridor, allowing new uses for office, retail and restaurants to help enliven the neighborhood, according to Burnett, whose ward includes both the Fulton Market District and the area west of Ogden. The more industrial western portion, including near a new CTA Green Line station opening at Damen Avenue in 2020, won't see big changes, he says.

More lenient zoning could induce sweeping changes to the Near West Side between the West Town neighborhood and the United Center campus, and would be a valuable parting gift to developers fretting an unknown future as the pro-development Emanuel administration exits next year.

In many ways, the Kinzie Industrial Corridor is exactly what Fulton Market was nearly a decade ago: low-slung buildings housing old-line, family-owned companies, complete with the clanking of industrial equipment and permeating scents of food processing and delivery truck diesel fuel. A mix of meatpackers, food wholesalers, brewers, floral shops, caterers and manufacturers populate the neighborhood, as well as some small offices in industrial buildings that are allowed under PMD rules. Metra and CTA tracks run through its heart, and the new Damen CTA station could catalyze neighborhood growth when it opens, much like the Morgan stop did in 2012.

And even though many developers doubt the city will allow them to pay for lucrative building density and height like it did in Fulton Market, some have already wagered on properties on the chance the city will help unlock land value there.

One big bettor is Howard Wedren, whose Dayton Street Partners real estate investment group has turned several industrial properties in the area into loft offices. The firm recently snagged four tenants and a Limitless Coffee location at a long-vacant brick-and-timber building it converted to offices at 1500 W. Carroll Ave.

"There's demand from office users here who don't want to pay the freight east of Ogden," he says. "And there are distribution and creative manufacturing (users) who want to attract the strong labor pool in Chicago's high-density neighborhoods and don't want to go to the Southwest Side but want proximity to public transit and bike lanes. That's what this submarket delivers."

CASHING OUT

Property values west of Ogden have risen as development in Fulton Market has approached, pushing longtime landowners to cash out. In one recent deal, the owners of a Chicago-based T-shirt design firm that paid $1.1 million in 2014 for an industrial warehouse at 1641 W. Carroll sold it in February for $2.3 million. A longtime landlord at 350 N. Ogden recently put its 70,000-square-foot loft office building on the market, hoping to seize the investor demand.

Next to the future Damen CTA station, the family owners of trucking maintenance company Standard Equipment have fielded a few inquiries a week for over a year from brokers and developers asking about the company's nearly 3-acre property at the northwest corner of Damen and Lake, says company President Jerry Donlon. He has put the site on the market and is seeking north of $14.5 million. Donlon says the lack of basic amenities in the area, blocked by the PMD, holds back businesses. Retail in the district is only allowed if a business is also manufacturing a product on-site, which is why a number of breweries have flocked there. "You can get a beer here almost any day of the week, but you can't buy a bottle of water," Donlon says.

But there are opponents to change in the neighborhood. The Kinzie Industrial Corridor is already a thriving mix of "makers" and small businesses that need proximity to the central business district but also reasonably priced industrial real estate to run their operations, says Hannah Jones, director of economic development at the Industrial Council of Nearwest Chicago. The nonprofit group is an incubator that leases almost all of its 416,000 square feet of industrial space along the 2000 block of West Fulton Street to a mix of light manufacturing businesses.

Jones admits the area could use an "after 5 p.m." jolt but fears the gentrification seen in Fulton Market and implores city officials to make sure it remains a primarily industrial zone. "We just want to keep this neighborhood for what it is—it would be a great loss to the city if it (goes) the same way Fulton Market went," Jones says. "Fulton Market doesn't feel like Fulton Market anymore. You're losing a lot of what made it special."

One development roadblock west of Fulton Market is large swaths of low-income housing along the south side of Lake, an obstacle developers didn't encounter east of Ogden. But that comes with a silver lining for developers: The demographic makeup of the area qualified a large portion of the Kinzie Industrial Corridor as an Opportunity Zone created under the recent federal tax reform. The program, which is designed to spur economic development in distressed neighborhoods by allowing investors to defer paying capital gains taxes if they redirect profits into designated low-income areas, could funnel more developers and investors into the neighborhood.

exclusive: dayton street partners buys in west fulton

September 11, 2018 - Bisnow

Dayton Street Partners purchased a 42K SF industrial building in West Fulton for $2.8M. This one won't be converted into another use, like so many warehouses in the area have been of late — it will be renovated and offered up as a last-mile logistics location.

The property — a 42K SF building on 1.75 acres — is at 2501 West Fulton. It was built in the 1960s and had been owner-occupied by Keystone but now is fully vacant. It fits the bill of the latest wave of industrial demand — older, smaller warehouses that are closer to population centers and can be used by e-commerce companies. Dayton Street has been carving out a name in that space as well, focusing on small infill industrial and office acquisitions.

“Demand for quality infill industrial space that features abundant parking and immediate access to Chicago’s neighborhoods is not abating,” Dayton Street’s Michael Schack said. “2501 West Fulton is the rare urban property that satisfies that demand.”

Its location just west of Chicago's central business district and the booming Fulton Market makes Dayton Street consider the location ideal for last-mile users — e-commerce logistics companies looking to store goods near customers to shorten delivery time.

Dayton Street will renovate the property, which already has 16-foot clear ceilings, two loading docks, one drive-in door, parking for 50 cars and 8K SF of newly built office space. It will add LED high-bay lighting, white box the warehouse and improve the parking lot.

JLL's Scott Duerkop and Dominic Carbonari represented the seller.

Dayton Street has been active in the Kinzie Industrial Corridor recently, redeveloping 2101 West Carroll, 2137 West Walnut and 1500 West Carroll. The Kinzie Industrial Corridor TIF is nearing the end of its life — the tax increment financing program meant to spur redevelopment began in 1998 and ends in 2021.

MIDDLE MARKET DIGEST - the midwest building blocks

July 13, 2018 - GlobeSt

MT. PROSPECT, IL—Chicago-based Dayton Street Partners plans to develop a 132,270-square-foot speculative distribution center at 1731 Wall St. in Mount Prospect, IL, for an investment platform sponsored by Black Creek Group, LLC. The company will break ground on the development later this month and plans to finish by spring 2019. The new state-of-the-art building will feature 32’clear ceiling height, up to 40 dock doors, two drive-in-doors and 176 parking spots. New buildings are tough to find in the O’Hare submarket, but this one will be located near O’Hare International Airport’s north cargo entrance, and Dayton Street expects to draw interest from a variety of users in the freight forwarding and service industries and/or users seeking modern infill properties for last-mile distribution and light assembly. “The proximity to the airport is obviously terrific,” says Michael Schack, Dayton Street principal. “With quick access to I-90, and within minutes of I-294 and I-355, the site provides an ideal central location from which to access the Chicago area.” This is the second project Dayton Street is developing for Black Creek in the O’Hare market. Early this spring, the firm announced plans to build a 116,000-square-foot speculative distribution center in Bensenville, IL.

Dayton Street and Black Creek partnering on 132,270 SF distribution center in Mt. Prospect

July 12, 2018 - Rebusiness Online

Chicago-based Dayton Street Partners plans to develop a 132,270-square-foot speculative distribution center at 1731 Wall Street in Mount Prospect, Illinois, for an investment platform sponsored by Black Creek Group, LLC. Dayton Street will break ground on the development later this month with a planned completion of spring 2019.

The new, state-of-the-art building will feature 32-foot clear ceiling height, up to 40 dock doors, two drive-in-doors and 176 parking spots. A premier location near O’Hare International Airport’s north cargo entrance, Dayton Street expects to draw interest from a variety of users in the freight forwarding and service industries and/or users seeking modern infill properties for last-mile distribution and light assembly.

“The proximity to the airport is obviously terrific. With quick access to I-90, and within minutes of I-294 and I-355, the site provides an ideal central location from which to access the Chicago area,” said Dayton Street principal Michael Schack. “Plus the corporate park setting means significantly less truck traffic than other areas close to the airport.”

This is the second project Dayton Street is developing for Black Creek Group in the O’Hare market. Early this spring, the firm announced plans to build a 116,000-square-foot speculative distribution center in Bensenville, Illinois.

Dayton Street to Develop 116,000 SF Distribution Center in Bensenville, Illinois

May 17, 2018 - Rebusiness Online

BENSENVILLE, ILL. — Dayton Street Partners is developing a 116,000-square-foot distribution center in Bensenville near O’Hare International Airport. Black Creek Group LLC owns the property. Construction will involve the demolition of an outdated facility located at 1055 Sesame St. The new building will feature a clear height of 32 feet, 24 exterior dock doors and 137 parking spots. Construction is scheduled to begin in June with completion slated for spring 2019.

Dayton Street Partners Jumps Into O'Hare Industrial Development

May 09, 2018 - Bisnow

Add Dayton Street Partners to the packed industrial development activity around O'Hare. The infill industrial specialist is partnering with Black Creek Group to build a 116K SF spec industrial building in Franklin Park. 

Dayton Street founder Howard Wedren told Bisnow the spec building will be built on two parcels totaling 6.5 acres at 1055 Sesame St. and 491 Podlin Drive in Bensenville. Dayton Street will demolish a 90K SF building on the Sesame Street parcel. Construction of the new building will begin in June, with an expected delivery in spring 2019. The new building will feature 32-foot clear heights, 24 exterior dock doors and 137 parking spots.

Wedren said Dayton Street and Black Creek are targeting distribution or third-party logistics tenants for the building, and will entertain a single tenant or multiple tenants.

Avison Young’s Q1 2018 Chicago industrial report showed O’Hare’s vacancy stands at 4/9%, well below the suburbs’ 5.9% vacancy rate. Just shy of 10M SF of new industrial product is under construction, 72% of which is spec development.

The high barriers to entry in O’Hare favor fast absorption, Wedren said.

Dayton Street Hires Rising Star for Underwriting

April 5th, 2018 - Connect Chicago

Dayton Street Partners, a niche real estate investment and development firm, has hired Joe Moriarty as an associate responsible for underwriting prospective acquisitions. He was most recently an associate with JLL’s capital markets group.

During his time with JLL, Moriarty led the underwriting and due diligence process for a team that closed 30 transactions valued at $915 million between January 2016 and September 2017. Considered a rising star at JLL, he was the recipient of the “Leadership Award” given annually to a top achiever in his peer group.

Dayton Street founder Howard Wedren called Moriarty “wise beyond his years, and we look forward to his contributions to our efforts as Dayton Street continues to expand.” The firm focuses on acquiring and developing infill industrial, office and retail.

Former JLL Associate Joe Moriarty Joins Dayton Street Partners

April 4th, 2018 - Chicago Tribune

Dayton Street Partners (Dayton Street) today announced that Joe Moriarty has joined the company as an associate responsible for underwriting prospective acquisitions.

Moriarty joins from JLL where he was most recently an associate with the firm's Capital Markets Group. While there, he led the underwriting and due diligence process for a team that closed 30 transactions valued at $915 million between January 2016 and September 2017. READ MORE

Goodman Manufacturing Signs 21,000 SF Industrial Lease in Chicago

March 8, 2018 - Rebusiness Online

CHICAGO — Goodman Manufacturing, a member of Daikin Industries Ltd., has signed a 21,000-square-foot industrial lease at 4150 N. Knox Ave. on Chicago’s North Side. The residential and commercial HVAC company will utilize the space as a showroom, training center and distribution hub. Dayton Street Partners owns the 41,000-square-foot property, which features a clear height of 30 feet, six docks, four drive-in doors and T8 lighting. Mike Senner and Steve Kohn of Colliers International in Chicago represented Dayton Street in the lease transaction.

This Week's Chicago Deal Sheet

November 21, 2017 - Bisnow

Cushman & Wakefield’s Teddy Walsh, Lenora Adds and Andrea Saewitz repped Dayton Street Partners in three leases totaling 19K SF at 1500 West Carroll Ave. in Fulton Market West. Limitless Coffee leased 9,450 SF, Neato Agency leased 6,350 SF and Breather leased 3,100 SF. The leases account for nearly half of 1500 West Carroll’s leasable footprint. Dayton Street plans to develop another 30K SF building on an adjacent lot.
 

Middle Market Digest-The Midwest

November 3, 2017 - GlobeSt

CHICAGO—Dayton Street Partners has preleased its newest project at 1500 W. Carroll. Neato Agency (6,350 SF), Limitless Coffee (9,450 SF) and Breather (3,100 SF) have signed on for approximately 50% of the property. The company expects the balance to lease-up quickly now that construction is complete. It acquired the 40,000-square-foot building in September 2016 and quickly repositioned the property for today’s creative office user. READ MORE

"Last-Touch" Distribution Transforming Industrial Landscape

July 17, 2017 - GlobeSt

CHICAGO—Distribution facilities for e-commerce are popping up in close proximity to the population centers of major US cities, creating a foundation for rapid-delivery service that didn’t exist on this scale just a few years ago, according to a new report from CBRE. CBRE analyzed the location of so-called “last-mile” distribution facilities opened within just the past two years in the 15 largest US population centers, finding that they are positioned, on average, between six and nine miles from the center of the largest population areas they serve.

And many are not the sleek, class A structures that have become so popular with users. It’s all about getting access to areas with dense populations, and industrial facilities with high ceilings and other class A attributed tend to be in outlying areas.

“A lot of these are older class B facilities that are infill locations in the older industrial corridors,” David Egan, global head of CBRE’s industrial and logistics research, tells GlobeSt.com. Distributors “prefer to have class A buildings, but those are rarely available.”

Denser cities such as Chicago, Boston, Washington, DC, New York tend to have shorter average distances. In San Francisco, for example, the average is just six miles. Meanwhile, cities that are more spread out have longer averages, such as 7.5 miles in Houston, 8.5 miles in Phoenix and nine miles in Southern CA’s Inland Empire. In compiling these average distances, CBRE focused on distribution centers smaller than 200,000 square feet.

And this reconstruction of the US supply chain does not just concern one or two headline-grabbing e-commerce providers.

“This is broader than e-commerce,” Egan says. Instead, it’s about a change in consumer behavior and expectations that touches every brick-and-mortar retailer in the US. Earlier this decade, goods ordered online often were delivered to customers from huge, outlying facilities, sometimes in other states. But shoppers increasingly expect nearly instantaneous delivery of their orders, and companies need to dramatically change how they handle logistics.

“Calling it last mile is in some ways missing the point,” he adds. “It’s about the last touch,” or a package’s last stop before hitting the customer’s door step. And what this means will probably differ for every distributor. To properly site their last stop facilities, each has to figure out exactly where their customers are, how often they make purchases, and what changes they anticipate over the next few years.

And that’s when the really tough job begins, Egan says, because businesses then need to calculate just how much they can spend on securing and staffing extra facilities. In some ways, the basic real estate questions are comparatively easy. “Once you solve all that, you can find a building.”

The complexity of the task means it’s going to take time to get it right, he adds. “E-commerce in general is in its very early stages, and this particular aspect is even earlier. Right now, it’s a lot of guess work, and guessing is expensive if you don’t guess right.”

Cities and other municipalities also have work to do to help this transformation continue. “There is going to have to be rezoning,” says Egan, perhaps of existing big-box retail buildings that have been undercut by e-commerce. “There may be some pushback from people who live in these neighborhoods,” and users will have to prove distribution operations can co-exist in dense areas. But structures like this already provide quick access to customers, adequate parking, and the necessary loading docks. “They’ve got what you’re looking for. It’s a great solution to the problem.”

How Dayton Street Partners Is Feasting On Smaller Infill Real Estate

July 13, 2017 - Bisnow

Adaptive reuse can be broken down into two camps: high-profile repositionings like Londonhouse, and smaller infill projects that fill immediate tenant demand in a market. Dayton Street Partners has made a science, and profits, of the latter.  Dayton Street Executive Vice President Michael Schack said his firm remains disciplined in its strategy of finding infill office and industrial assets in highly desirable submarkets. Dayton Street wants to be a low-cost provider in the market and the assets it is interested in can be acquired at lower price points than what other developers are paying, and repositioned quickly to meet tenant demand and command market rates.

But the competition for value-add assets has increased in the last three or four years as investors turn their attentions from a dwindling number of core opportunities to non-core assets that can be repositioned. Prices have increased, and Dayton Street has backed away from several opportunities because the pricing did not make economic sense.

Schack said the assets Dayton Street does acquire allow it to penetrate its target markets quicker and more efficiently. One of its higher-profile repositionings is a five-story building at 1500 West Carroll in Fulton West. Dayton Street is adapting the building into 40K SF of loft office space. Prospective tenants seeking a Fulton Market address are looking west, as tech tenant demand pushes rents in the heart of the submarket to some of the highest in Chicago. Schack said rents at 1500 West Carroll are under $30/SF, compared to $40/SF elsewhere in the market.

And interest is growing: Schack said that Dayton Street has two floors at 1500 West Carroll fully leases, talks to lease up a third floor are ongoing and Schack expects the building to be 50% leased within a month.

Dayton Street’s $2M in capital improvements to a industrial facility at 6123-6227 Monroe Court in Morton Grove are almost complete. The firm bought the 206K SF multi-tenant warehouse last year for $6M. Schack said the property is fully leased but the improvements - interior and exterior renovations, a new roof and lighting, upgrades to the loading docks and 1.5 acres of secured parking and trailer storage - will allow Dayton Street to re-lease the building at market rents. Dayton Street has interest in space from multiple prospective tenants.

Schack said the Fed’s interest rate hikes, and its pressure on banks to tighten lending, has not impacted Dayton Street’s ability to structure deals. The firm’s primary lenders remain local lenders and pension funds, and Schack said Dayton Street is underwriting interest rate increases during hold periods to account for future hikes.

Those hold periods are on an asset-by-asset basis. Some are longer term. Others, like a warehouse at 920 West Pershing Road in Bridgeport, were quickly sold once Dayton Street completed renovations and locked in tenants.

Schack said Dayton Street has kicked the tires on some Class-C assets in the central business district, but considers the submarket to be a secondary priority. Schack believes much of the value-add office product in the CBD is obsolete and will be adapted into another asset class like multifamily or retail, sectors that are not part of Dayton Street’s strategy.

WHERE THE MAKERS ARE: WEST FULTON MARKET

March 30, 2017 - Crain’s Chicago Business

On any given day, trucks pick up pallets of beer from Goose Island to distribute across Chicago and beyond, small forklifts transport bags of beans harvested around the world to roast at Intelligentsia Coffee & Tea, and occasionally people pop by to get a fresh pint, a pour-over coffee or apple brandy in a cafe or tasting room. READ MORE

Dayton Street Partners sell Chicago distribution facility for $4.1M

March 17, 2017 - Rebusiness Online

Dayton Street Partners sold its 43,000-square-foot distribution facility at 920 W. Pershing Rd. in Chicago to a private investor for $4.1 million.

The property was first acquired in 2015 by Dayton Street and was transformed from an antiquated manufacturing building into a modern warehouse and distribution facility.

Last year, Trane U.S. signed a 25,000-square-foot lease and Stanley Steemer signed an 18,000-square-foot lease at the property.

DAYTON STREET BUYS A WAREHOUSE BUILT TO RESEMBLE A CASTLE

October 18, 2016 - Bisnow

Dayton Street Partners has found a sweet spot in the blistering hot Chicago industrial real estate market by buying and rehabbing assets in niche submarkets. Dayton Street's latest acquisition is ginormous, by the firm's standards. It just closed on a 206k SF, multi-tenant warehouse at 6012 Monroe Court in Morton Grove.  

Dayton Street paid $6M for the fully leased property. The building’s design is a story in itself. Its developer, Dick Elder, had a thing for castles and added castle-like touches and names to all of his buildings. The Morton Grove property features turrets in the masonry, and Dick (who sold the property in October 2016 and passed away early this year) even went so far as having period manikins made to stand on the roof during the summer.

Dayton Street is planning a $2M improvement program for the property that will include interior and exterior renovations, modernizing the facade, installing a new roof, adding T-8 lighting and upgrading loading docks. Dayton Street will also demolish several metal outbuildings to make room for 1.5 acres of secured parking/trailer storage.

Dayton Takes On Another Fulton West Project

September 20, 2016 - GlobeSt

CHICAGO–Users looking for creative office spaces have focused a lot of their attention on the Fulton Market neighborhood, as Google and the other top tech firms that have moved in are also attracting new retail and restaurants.  But the rental rates there have soared, and some prospective tenants may be looking to gain access to the local amenities, but at cheaper prices.

That’s part of the thinking behind Dayton Street Partners’ acquisition of a 40,000-square-foot building and 15,000-square-feet of land, located at 1500 Carroll Ave., on the edge of the booming neighborhood, from a private seller.

LOFT OFFICES PLANNED WEST OF FULTON STREET

September 12, 2016 - Crain’s Chicago Business

A Chicago developer plans to create 70,000 square feet of loft office space on the Near West Side, believing it can capture tenants priced out of Fulton Market District a few blocks to the east. READ MORE

WAREHOUSES ARE SEXY ALL OF A SUDDEN. HERE'S WHY.

August 27, 2016 - Crain’s Chicago Business

In the shadows of the apartment, hotel and office towers rising in recent years, an often unnoticed form of real estate has begun taking off in Chicago: warehouses. READ MORE

SCHACK JOINS DAYTON STREET PARTNERS

July 13, 2016 - GlobeSt

CHICAGO—The Chicago firm has played a key role in remaking neighborhoods adjacent to the downtown into centers for distribution. Michael E. Schack, a veteran asset manager with strong ties to Chicago, has just joined Dayton Street Partners as an executive vice president. He will oversee the firm’s asset management and day-to-day operations, says founder and principal Howard Wedren.

Schack’s experience spans office, industrial, retail, residential and hotels in both suburban and central business district locations throughout the US. In the last 30 years career he has handled about $4 billion of sale or acquisition transactions and more than $2 billion in lease transactions.

South Side distribution centers filling up

June 27, 2016 - GlobeSt

CHICAGO—Dayton Street Partners has helped lead the transformation of a S. Side neighborhood into a distribution center, and just got one of its projects to 100% leased. Dayton Street Partners, a Chicago-based developer, has just filled up its most recent development, the latest in a series of projects that has helped transform an underutilized South Side parcel into a modern center for distribution.

Trane US, a subsidiary of Ingersoll Rand, has entered the Chicago market with a 24,950-square-foot lease at Dayton’s 42,860-square-foot industrial property located at 920 W. Pershing Rd. in Chicago’s Stockyards neighborhood. The development that will serve as the company’s Midwest distribution center.

Dayton Street Is Rebuilding Chicago Industrial, 40k SF at a Time

September 8, 2015 - Bisnow

While spec industrial development these days is centered on giant facilities in the suburbs and around O’Hare, one contrarian developer is finding success building smaller warehouses inside Chicago's borders and bringing The City That Works back to the neighborhoods.

Dayton Street Partners founder Howard Wedren has been busy in recent months building and rehabbing small industrial spaces in niche submarkets. Howard says there’s a market for smaller industrial within the city limits other developers are missing by focusing on office, multifamily and mixed-use. Howard adds these deals aren’t easy to come by, but he’s been successful by doing his due diligence with site selection. Dayton Street finds sites with ease of access to expressways and state highways, overcoming what he calls “geo-technical and environmental issues.” Building and repositioning to suit allows Dayton Street to target smaller companies that don’t need the large footprint developers are building to target tenants with suburban warehouses.

Howard says he was inspired by the success of Halsted Pershing Business center at 815 W. Pershing in Bridgeport’s Stockyards Industrial Park. This 104k SF building was one of the first spec industrial buildings built in Chicago in 20 years when it was delivered in 2009. Dayton Street sold the building to Alliance Capital Partners last June for $10.7M.

Howard says Dayton Street has two more projects in the works near the stockyards. A 50k SF warehouse at 920 W. Pershing was transformed into a state-of-the-art cold storage facility with all new electrical and loading docks. Dayton Street will also break ground on a new 55K SF warehouse at Halsted and 43rd streets in October.

Howard says he’s very excited about building a 40k SF warehouse at 4150 N. Knox. He says the North Side is a tight market with very little land to satisfy demand, and that industrial-zoned space is even more rate. Howard adds this building, located a half-block from I-90, would be ideal for food, distribution or light manufacturing companies looking for direct access to the city and expressways. The building will feature 30-foot clear heights, four docks, two drive-in docks and T8 lighting.

Dayton Street is even entering the loft office game. Howard says the group will deliver a fully redeveloped, 40k SF loft office space at 2137 W. Walnut in December. The $1M rehab features new steel staircases, lighting and electrical, and an ADA-compliant elevator. Howard says the building’s location west of the red-hot Fulton Market will be a draw for companies looking to be near the are, but with significantly lower rents.

The New Incentives for 2010: Building Big in Chicago (PDF)

January/February 2010 - Illinois Real Estate Journal

Chicago has long been known as one of the nation’s most thriving and diverse local economies. One of the main reasons for this is a city government that provides substantial economic incentives designed to start, expand, and attract companies to Chicago. This year, we will see more of these financial assistance programs coming online than ever before and their impact on the city’s economy promises to be significant.

Stockyard (Still) Drives Development (PDF)

December 3, 2009 - Bisnow

One hundred years ago (when Bisnow was engraved in papyrus), immigrants came to Chicago to work in the South Side Stockyards. That same square mile between Halsted, Ashland, Pershing, and 47th is still providing jobs, only now in distribution and manufacturing. You know it as the Stockyards Industrial Park, home to 80 companies, and an example of urban revitalization. Back of the Yards Business Council's Craig Chico and Martha Jungenberg and Matanky Realty's James Matanky (also commissioner of the area), tell us 70 buildings have gone up since the late '80s, occupied by companies such as Gourmet Kitchens, Gypsum Supply Co, Tyson, GE Zenith Controls, HydroAire and Testa Produce.

Midwest Real Estate News: "The New Green is Brown"

April 1, 2008 - Midwest Real Estate News

Today it is almost passé to not push a green agenda, but what frequently gets left out of the conversation is that many companies may do more good by switching the color spectrum entirely – and pursuing “brown” instead.

Let us explain. Reducing one’s carbon footprint has become a hot-bottom issue, and the commercial real estate industry has been labeled the biggest offender in terms of emissions. In response, developers and architects have rallied to the cause and are pursuing greener buildings. But the question that is often never asked is, instead of just reducing their carbon footprint couldn’t real estate pros be striving to make any new footprints, period?

Stockyard Area Expecting New Spec Industrial Facility (PDF)

June 27, 2007

Dayton Street Partners LLC is developing the proposed industrial building in the Halsted Pershing Business Center, designed by Cornerstone Architects. The building will be built on a 6.9-acre site at the southwest corner of Halsted Street and Pershing Road. READ MORE

Spec building to be gateway to new Stockyard (PDF)

June 21, 2007

Dayton Street Partners LLC has announced plans to develop an 80,000 square foot speculative industrial building at the gateway to the Stockyards industrial park, one of the first of its kind in this historic industrial market. The 6.6-acre site for the development is located at the southwest corner of Halsted Street and Pershing Road in Chicago. READ MORE