Transwestern Brokers the 5-Year, 55,000 SF Lease Renewal
May 22, 2023
CHICAGO – Transwestern Real Estate Services (TRS) announces Schwab Paper Products has signed a five-year, 55,000-square-foot lease renewal at 636 Schwab Circle, an industrial building in Romeoville, Illinois. Schwab Paper Products occupies the entire building. Transwestern Executive Vice President Terri Alexander, SIOR represented Schwab Paper Products in the lease negotiations.
Schwab Paper Products, a manufacturer and converter of packaging materials, previously owned the building, and Transwestern represented Schwab in the sale/leaseback of the building. Transwestern also assisted in several sublease negotiations for Schwab within the building.
“Finding a new location would have been particularly challenging for us,” said Operations Manager Juan Vazquez. “The cost to finding a new manufacturing building tailored to our needs would have far outweighed the benefits of moving.”
As a manufacturing building, 636 Schwab Circle features thicker floors, distributed electric, food-grade improvements and an upgraded HVAC system. It is conveniently located in close proximity to Interstates 55, 355, and IL 53 ramps.
“Tenants are experiencing a difficult time in the market, especially for renewals,” said Alexander. “With market rents dramatically increasing, tenants are experiencing sticker shock at renewal rates. While it was possible to find opportunities with lower rent, the cost of improvements and move costs ultimately became determining factors in the lease renewal.”
In Transwestern’s Q1 2023 Chicago Industrial Market Report, Research Director Caitlin Ritter explains that industrial vacancies, including manufacturing space, remain low, resulting in a lack of available options for tenants and rapidly growing rental rates. Asking rental rates are experiencing double-digit annual growth.
“The tight conditions in the Chicago market have led to unprecedented annual rent growth. Tenants with leases up for renewal are facing significant rent increases but are finding few options for relocations,” said Ritter. “Fortunately, there is currently 40.5 million square feet of industrial inventory under construction that should return some balance to the market.”
Owner Link Logistics was represented by Lee & Associates Principal Ryan Earley.
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About Schwab Paper Products
Since 1924, Schwab Paper Products has been a specialist in converting paper, paper board, and packaging products for users in many industries. Our goal is to become a number one supplier of diverse paper and packaging products for fish, meat poultry, confectionary, as well as industrial markets. Our full line is designed to protect products, speed handling, and assure quality for the user’s purpose. We continue to apply our experience in the development of new techniques and products to make the handling, packaging, shipping, and storing of products. For additional information visit schwabpaper.com.
About Transwestern Real Estate Services
Transwestern Real Estate Services (TRS) adds value for investors, owners and occupiers of all commercial property types through a comprehensive perspective and by providing solutions grounded in sound market intelligence. Part of the Transwestern companies, the firm applies a consultative approach to Agency Leasing, Asset Services, Tenant Advisory + Workplace Solutions, Capital Markets, and Research & Investment Analytics.
The privately held Transwestern companies have been delivering a higher level of personalized service and innovative real estate solutions since 1978. Through an integrated, customized approach that begins with good ideas, the firm drives value for clients across commercial real estate services, development, investment management, and opportunistic endeavors for high-net-worth investors. Operating from 33 U.S. offices, Transwestern extends its platform capabilities globally through strategic alliance partners whose unique geographic, cultural, and business expertise fuels creative solutions. Learn more at transwestern.com and @Transwestern.