HSA Commercial profiles a broker at our firm each month as part of our HSA News & Views blog. In this edition, we talk with Brad Borkowski, associate with the Industrial Services Division. Brad started five years ago as an intern at HSA but has leveraged his personal knowledge and experience in the logistics industry to establish himself as a dynamic industrial broker.
HSA: Where are you seeing the most industrial activity in Chicago right now?
Borkowski: Distribution tenants continue to drive most of the demand in the I-88 and south I-55 corridors, and that’s a trend that will likely continue. However, larger tenants, those greater than 300,000 square feet, have limited options in the I-88 corridor, especially with the types of heavy loading and clear height requirements that modern distribution tenants have come to expect. Therefore, I believe we may start seeing build-to-suit developments and possibly spec development to accommodate these users in I-88 this year.
HSA: Do you see the same type of development taking place along I-55?
Borkowski: The south I-55 corridor has been seeing quite a bit of activity as well. Though there are a few users with proposals out that have yet to settle on a location, there are still several large distribution facilities to choose from. However, availabilities in the smaller, multitenant industrial buildings are becoming harder to find. We have several listings along I-55 where we have seen a flurry of activity in the past month with smaller tenants. We have been very busy responding to proposals and showing space, and believe that the increase in activity bodes well for the rest of the year. As spec development returns in the southwest suburban industrial corridors, I would expect that it will be to satisfy the demand from these smaller tenants.
HSA: Is the industrial investment market just as busy?
Borkowski: There has been a sizeable influx of cash amongst certain institutional investors that are scouring the market right now for investment opportunities. In a lot of cases, those investment dollars are still looking for a place to land, and they’ll continue to put downward pressure on cap rates for Class A industrial product. We’ve started adapting our business model to work with local owners to help them package investment portfolios to attract the attention of investors. For well-leased properties, there really hasn’t been a better time to sell in recent memory.
Brad has extensive experience in warehousing management, having served in several management positions with Midwest Warehouse & Distribution System, Inc., for many years while attending college. His familiarity with warehouse operations allows him to better understand the needs of his clients.