By Micah Maidenberg
June 13, 2012
(Crain's) — A self-storage company has bought a mostly empty
building in the Clybourn Corridor shopping district that once housed a
Circuit City, paying about half of the $20 million owed on the property
when its lender filed to foreclose two years ago.
June 13, 2012
A trust associated with Barrington-based Life Storage Centers LLC purchased the building at 1030 W. North Ave. for $10.8 million in March from a venture of Miami Beach, Fla.-based LNR Property LLC, a so-called special servicer of troubled loans, county records show.
Circuit City Stores Inc. once leased about 35,000 square feet, or 31 percent of the four-story, 114,000-square-foot building. But the electronics retailer closed the store in November 2008 and went out of business the following year.
By June 2010 the previous ownership group, led by Chicago furniture dealer Lloyd Stein, began missing payments on a securitized loan encumbering the building, according to a foreclosure suit a loan trustee filed in October of that year.
The LNR venture took ownership of the property in March 2011, according to a sheriff's deed. Mr. Stein did not return a call seeking comment.
Cheri Grossman, senior acquisitions officer for Chicago-based JRG Capital Partners LLC, which invests in underutilized urban properties, says Circuit City was likely seen by its lender as a stable retailer that would generate a reliable income steam. Circuit City began its lease in 2003, with the former owners taking out the loan the following year.
“You could see how you could get a loan that in today's market is hard to imagine,” she says. “But it was done based on the economics of the time.”
Ms. Grossman says JRG toured the property for a possible acquisition but ultimately decided not to bid because they don't have a specific use in mind for it.
“I definitely think it was priced based on the vacancy of the building and the need for a redevelopment,” says Christopher Barry, a co-owner of Life Storage.
Life Storage had been scouting for a site in the area for about five years, he says. He likes the location across from an Old Navy store and other retailers.
“We like to be on the corner of Main and Main,” he says. “It's no different than McDonald's.”
The project will include at least one level of self-storage, as well as retail and office space, Mr. Barry explains. The exact layout will depend on how leasing proceeds. He says one retailer was interested in taking the first two floors of the building; he declines to name the company.
Some of Life Storage's 18 current locations take a mixed-used approach, says Mr. Barry, while others are stand-alone storage facilities.
The Life Storage-affiliated trust in March borrowed $11.7 million from several individuals and a family trust that listed Chicago-based investment firm Performance Trust Capital Partners LLC as its address, county records show. A message left for a Performance Trust executive was not returned.
Mr. Barry says the loan will pay for interior and exterior enhancements, plus fund tenant improvement costs.
The property also includes a 200-space attached parking garage and a basement. Just one tenant, a gym, is currently leasing space in the structure, Mr. Barry says. It occupies about 10,000 square feet, according to real estate data provider CoStar Group Inc.
http://www.chicagorealestatedaily.com/article/20120613/CRED03/120619928?template=printart
_____________________________________________________________
This blog wonders just who these individuals are....
Date
After our last report on the improvements, the recent departure of Tim Smith also seemed to mean the departure of respect, professionalism, and common courtesy, as the current team du jour of Marcus and Amanda seem destined to kill business, even from long-time customers, with an emphasis solely built on collecting rent. Have a question about your account? They won't make the time to discuss, and simply announce that they "don't have time to argue with you." Ask for toilet paper for the tenant bathroom? Request ignored. Try for a cup of the gratis coffee, "I haven't made it yet." - accompanied by a shifty-eyed glare. Want a clean restroom? You will be ignored, for almost eight weeks; as trash and dirt accumulate to the point of disease.
Ditto for the hallways.
Accounting issues are met with overlocks, and aggression; along with regular price increases.
Store staff issues have to be addressed with the District Manager, Ms. Shalonda, who under the guise of support, seemingly makes excuses for unprofessional behavior, only to have retaliatory behavior on the part of the aforementioned.
If this was simply a case of 21st century ill-manners, then this all might be ignored, but since the units are not free, then this is a serious issue. Run, don't walk from Lifestorage of Rogers Park.