Venture One Acquires 422K SF Industrial Portfolio in Metro Chicago

Venture One Real Estate recently acquired a five-building industrial portfolio totaling 421,638 square feet through its VK Industrial VII acquisition fund. The properties, previously owned by Zilber Property Group, are located throughout metro Chicago, as per CommercialEdge data. This acquisition marks one of the first investments made using the VK Industrial VII fund.

VK Industrial VII Fund and Portfolio Financing

In early 2024, Venture One initiated a $300 million capital raise for its seventh industrial fund, co-sponsored by Kovitz Investment Group, according to SEC filings. Prior to this, the company set a $250 million target for its sixth industrial fund. The acquisition of this latest portfolio was facilitated by CBRE's Zach Graham, Ryan Bain, Michael Caprile, and Joe Horrigan, who represented the seller.

Key Details of the Industrial Portfolio

The portfolio consists of single- and multi-tenant facilities, all fully leased to 13 tenants at the time of purchase. Building sizes range between 37,174 to 154,335 square feet, with individual units spanning from 7,953 to 84,373 square feet. The largest facility, located in Northbrook, Illinois, covers 154,335 square feet and features 24-foot clear heights, 40-by-40-foot column spacing, a 120-foot truck court, and parking for 187 vehicles. Other properties are located in Mokena, Elgin, and Willowbrook, Illinois, averaging 31 miles from downtown Chicago and close to major transport hubs like Chicago O’Hare International Airport and Illinois International Port District.

Venture One’s Investment Strategy and Recent Deals

Venture One focuses on acquiring industrial assets across the Chicago metro area, as well as in the Northeast U.S. and Florida, utilizing discretionary funds. Earlier this year, the company purchased another industrial portfolio in St. Charles, Illinois, totaling 785,181 square feet for $50.2 million. This transaction was backed by funds from VK Industrial VI and a $30.4 million loan from Lake Forest Bank & Trust.

Trends in Chicago’s Industrial Market

Chicago's industrial sector has seen a slight decline in both trading activity and project completions in 2024. According to Cushman & Wakefield, year-to-date through June, investors traded 10.8 million square feet, a 2.4 percent decrease from the previous year. Industrial completions dropped by 34.3 percent, totaling 7.5 million square feet. Moreover, speculative projects accounted for 63.8 percent of the total deliveries, contributing to a higher vacancy rate of 4.5 percent—a 90-basis point increase year-over-year. Additionally, 12 million square feet of industrial space remain under construction, reflecting a 54.5 percent year-over-year decrease.