A prominent New York private equity group is making a big play in Chicago’s industrial market.
Kohlberg Kravis Roberts, or KKR, in late June paid $17.27 million for a newly developed industrial building at 7720 North Lehigh Avenue in Niles, according to property records. At the same time, KKR also took out a $150 million loan from Chicago-based Heitman Capital that was secured by the Niles property, records show.
Selling the building was Oakbrook Terrace-based Molto Properties, which in 2017 developed the 136,000-square-foot warehouse with 110 parking lots. Weldcote Metals in 2018 signed a 48,600-square-foot lease in the facility, Area Development reported at the time.
KKR is investing in a Chicago industrial market that shows no signs of slowing down. Vacancy for the sector hit an 18-year low in the first quarter, and developers are working overtime to fill the demand. A flood of new inventory hit the market in the second quarter with more than 17 million square feet of industrial development in the pipeline.
Molto is adding to the pipeline as well. The firm has a venture with Ohio-based Pizzuti Companies to build a 274,000-square-foot speculative industrial building in Aurora. Molto has at least 11 developments in the works in Illinois, according to its website.
KKR opened its real estate investing division in 2011 and has invested $7 billion in the industry since. The firm led a joint venture that paid $196 million for the Yorktown Center mall in Lombard. In March, KKR received a short-term extension on the maturity date of its $114 million debt on the shopping mall, Crain’s reported at the time. The firm did not immediately respond to requests for comment.Recommend0 recommendationsPublished in