Read the full story

bit of Chicago CRE lore from the late '80s includes a major office developer who, during a panel discussion, became exasperated with Wall Street's growing control of developers like him, demanding preleasing and the like in return for debt financing. "Preleasing is for sissies!" he proclaimed. Yesterday was a little blast of the (mid) '80s: a new office tower downtown, no preleasing necessary.

The Ivanhoé-Hines JV has the equity firepower to get the building out of the ground without resorting to debt, which would be hard to get even with a major anchor tenant. By going the equity route, the developers assume all the risk but also stand to reap all the long-term rewards by capturing a piece of any upsurge in leasing during the rest of this decade. Bisnow asked Hines SVP Greg Van Schaack about the conspicuously missing anchor. Tenants will come, he says. For one thing, the property's going to include an acre-and-a-half park fronting the river, something no one else in the city has. (Allowing tenants to have a catch or watch clouds on their lunch breaks, something everyone dreams of.) Greg also says that the building's shape and position on the river are going to make it instantly iconic. Tenants thinking about looking for space now will be very familiar with the tower ahead of its 2016 completion.

At yesterday's event announcing the building, alsweman Brendan Reilly points out a feature of the new tower to Mayor Rahm Emanuel, Ivanhoé Cambridge EVP Arthur Lloyd, and Hines Midwest CEO Kevin Shannahan. Bisnow also talked to one of our recent developer panelists, Trammell Crow's Grady Hamilton, to sound him out on the project. He told us that Hines' announcement underscores what was said by most panelists that morning—that fundamentals have tightened and that the market has several companies whose requirements will not be easily met by the vacancy within the existing building stock. "As the trend continues, I believe we will see further capital interest in CBD development," Grady reiterates.

Mark Segal Photography

Capital Markets Still Unsettled by Uncertainty

What do the capital markets hate more than anything? (Bad hair days? Greece?) Uncertainty. But uncertainty makes for interesting talk, and there's bound to be a fair bit of talk at our upcoming Chicago Capital Markets Summit on May 29 at the Westin River North. MetLife regional director Betsy Clark (pictured with JLL’s Keith Largay), who will be a panelist, tells us that there's still a lot of uncertainty surrounding the capital markets, created by the lack of sustained job growth, regulatory uncertainty, low interest rates and the political climate. Many businesses are still showing restraint and indecision in expanding their operations and thus don't need more office or industrial space, she says. Until we see clarity around these issues, we can expect to see some investors waiting on the sidelines and others proceeding cautiously.

Suburban Incentives Kick-Start Activity

The 167k SF 2001 Mt. Prospect in Des Plaines had been vacant for more than four years, a typical example of a property vacated by a former light industrial user that moved overseas and kept empty by the recession. Recently office supply company Warehouse Direct leased it after the city of Des Plaines approved a Class 6b property tax incentive, the city's first since the incentive was revised, thereby slashing the property tax assessment. "It was just the right incentive at the right time," says Cobalt Partners director Bryan Moreland, whose company owns the property (he's pictured in front of the building with Des Plaines City Manager Michael Bartholomew and attorney Brian Liston, who handled the legal nitty-gritty). "Without the city's foresight on this matter, the building would still be empty, contributing nothing to the city's tax rolls."

Another example of recent incentivizing in the suburbs involves the redevelopment of 820 Madison in Oak Park, which recently overcame a major hurdle in winning $12M in tax credits from the Illinois Housing Development Authority. A solidly built structure nearly a century old, its last use was as a Comcast office, but the cable company left four years ago. Interfaith Housing Development Corp plans to make it into 51 units of affordable housing. Interfaith COO Perry Vietti tells us that the organization is on track to begin construction in the fall. "The development will serve low-income persons who primarily live in Oak Park while also contributing to the revitalization of this portion of Madison Street," he says.

Studley Staff at the Special Olympics

Spring is here, time for outdoor sports. And it's always time for supporting a worthy cause. Studley's Chicago office staff did both last weekend at the Special Olympics Area 3 Spring Games. Studley’s Tania Hodge, Jon Azulay, Lisa Davidson and Sarah Cogswell cheer on a long jumper.

16" BROKER B-BALL WEEKLY ROUNDUP

MVP: Golub was clinging on to a one-run lead when MB's Jack Gavin delivered the fatal blow with a three-run homer over the Green Monster (un-cut grass in deep left field).

Off the Field: Jack recently penned a report about how loft space in Chicago CBD is hot stuff.

Postgame schmooze: The Opening Day Party, hosted by the Webb Group as usual, filled both rooms at Gamekeepers with sweaty brokers trying their hand at karaoke, which was hosted once again by Bill Barry of Draper & Kramer. (Best to stick to 16" softball, sweaty brokers.) Speaking of softballs, Gary Denenburg of MB and GE Asset Management provided DRESL with this year's Clinchers softballs, complete with logos of each of their properties on the balls—181 W. Madison, 500 W. Madison, 230 W. Monroe, and so on, about 14M SF all together. (We have it on good authority that they won't have to change any of those logos this year.)

FIELD 1: CUSHMAN & WAKEFIELD 16, JONES LANG LASALLE 2. C&W was off to a 7-run lead in the first inning that JLL 2 could never recover from. Former Chubby Ellis All Star third baseman John Kinsella continued his mastery of the hot corner.

FIELD 2: JF MCKINNEY 10, UGL-EQUIS, 6. The game was tight until the sixth. Cold stone ringer Eric Schaller roped a tape-measure homer, while Big Jim Hickey was masterful on the mound.

FIELD 3: MB 10, GOLUB 7. Our own Jonathan Hobfoll laced three singles during the game (that’s the power of the press).

FIELD 4: MID AMERICA 17, CTK PARTNERS 7. Mid Am wins the game, highlights were, “Everyone hits! Everyone catches the ball!”

FIELD 5: CB 1 AND ONLY, 22 , KLEIN'S CORPORATE 7. Hitting stars for CB included Mark "Flow" Floersch, Rudy Rudersdorf and Mitch Adams, who went right more than Mitt Romney in the primaries.

FIELD 6: COLLIERS 23, TRANSWESTERN 10. Jordan Kaufman on the bump contributed 5-7 with three doubles and six RBIs.

FIELD 7: TISHMAN SPEYER PROPERTIES, INLAND AMERICA. In the battle of last year's cellar-dwellers, TSP came out on top.

Strategic Hotels & Resorts CEO Laurence Geller was inducted into the UK’s Order of the British Empire two weeks ago to honor his philanthropy for children and chairmanship of the Churchill Center. He says the ceremony was “lovely” and the award “ill deserved,” but he’s not giving it back.

Laurence grew up in a rough part of London, he tells us, and was a schoolboy jock but learned early that he was “pretty dumb.” (That’s what one says when they’re wildly successful.) At 15, he ran away to Switzerland to become a chef (which seems pretty romantic, except those Swiss are really fussy about their food). In ’76, he landed in the US to run Holiday Inn’s international operation and in ’86 became a Pritzker partner. Luck, Laurence says, “gets you places.” In ‘97, he launched Strategic, which ended ’11 with revenue of $763M and a gross profit of $374M, doing better than competitors but not as well as he would like, he tells us.

US hotels are strengthening but not back to peak ’07 numbers, says Laurence who recently acquired a Four Seasons in Jackson Hole and another in Silicon Valley. He’s hunting for resorts to buy since he expects little new supply for 10 years. Last spring and summer, Strategic exited from Europe for better yields in London, the US, and Mexico. Chicago, where Strategic owns the Marriott Lincolnshire, and the Fairmont and Intercontinental downtown, is a relatively strong market, especially with the return of big conventions. Laurence predicts that there won’t be new big hotels developed here and that boutiques won’t work in this meat and potatoes city.

With the help of staff like financial analyst Clay Thelen, in recent years Strategic has acquired rather than built new hotels. Laurence says why develop when they can buy for 50 cents on the dollar? (The age-old question: Why buy the cow when you can get the milk for half price?) He’s been lowering management costs by 21% and raising operating efficiency while maintaining quality service. He’s creating more non-room revenues, introducing meeting rooms, wine bars and retail. At the InterContinental here, he brought in a Michael Jordan steakhouse, investing just $4.5M but expecting a 25% return ($1M). Bottom line, he says, costs are lower and revenues higher.

Technology has also proved to be a big draw but Laurence says most hotels just ignore the possibilities. In his Silicon Valley Four Seasons, he is removing the front desk. Instead guests will be greeted by a concierge with an iPad and interactive tables in the lobby. In his Four Seasons in Punta Mita (above), 45 minutes north of Puerto Vallarta, he says he’s “redesigning the meaning of resort.” He’s installing luxury tents that will have hardwood floors, four poster beds, outdoor pools, and decks. For children, there’s daycare; for teens playcare and for parents, the adults-only pool. (Don't worry, adults-only pools aren't anything like the ones in late night movies.) Mojito anyone for just $15k a day?

Finally … A Spec Tower

It’s official; a JV of Montreal-based Ivanhoe Cambridge ($300M), Houston-based Hines ($100M) and Chicago’s Larry Levy today announced that it is developing a spec 45-story office tower downtown at 444 W. Lake St. In an office market where large blocks of Class-A space are getting harder to find, the Pickard Chilton designed, glass clad riverfront tower will have a first mover advantage in snagging tenants. The $400M West Loop high-rise is the largest real estate development to start in the past five years, and the first spec office tower in at least a dozen years. Asking rents will be about $35/SF net.

$192M for O'Hare

If the City Council approves, a new $192M Northeast Cargo Center will be developed at O’Hare International Airport by Aeroterm whose EVP Erin Gruver (second from left) was with Mayor Rahm Emanuel, commissioner of aviation Rosemary Andolino and alderman Michael R. Zalewski for the Monday announcement. Aeroterm will invest $130M and the airport $62M for the project. The new facility will increase cargo operations and make O'Hare even more competitive worldwide.The City says the new facility will create 1,200 construction jobs, 1,200 permanent jobs on-site, 10,000 jobs in the region and further Chicago’s position as a leading US gateway for exports to China. Aeroterm will also create a program to train students for aviation industry careers.

Historic Apartment Market

Appraisal Research’s Ron DeVries (here with colleague Gail Lissner) says that the metro area’s apartment market has hit historic highs for rents and occupancy and will continue to rise this year, according to its Q1 ’12 report released yesterday. But in ’13, the 3,000 new units being delivered will slow the market’s growth. Rents in downtown Class-A apartments rose 9.2% to $2.50/SF compared to a year earlier and in luxury apartments they rose 9.7% to $2.72/SF. Class-A downtown occupancy is 94.7%, up from 93.9% a year ago. But the picture for new downtown condos is bleaker. With 113 closings in Q1, Ron expects about 500 units sold in ’12, down from 770 in ’11, 1,682 in ’10, and 1,891 in ’09.

Read the full story

Read the full story

Read the full story

See also: Hines to develop Chicago office tower

Read the full story

SALES

NelsonHill's Mark Nelson and Michael Nelson repped the sellers in four Q1 industrial deals: Loomis St. bought the 96k SF 1400 W 37th St in Chicago from Dreamers LLC. MGI Leasing acquired the 82k SF 11821 S Cottage Grove Ave, which sits on 13 acres and has an active exterior rail spur for 50 rail cars on the South Shore/South Bend line. Bulkoa was the seller. Alliance Products purchased the 50k SF 4931-5021 W Armitage from Scherston LLC. Private investor Mufid Saleh bought the 48k SF flex/warehouse at 431 N Wolcott, along the Kinzie Corridor, planning to develop it as a multi-tenant office/warehouse. Scherston was also the seller in this deal. *** Demolition contractor Nickelson Industrial Service bought a 17k SF industrual building at 10115 S Torrence Ave. Paine/Wetzel/TCN Worldwide's Edward Wabick and Albert Schulman repped the seller and were the sole brokers. *** Strauss Realty arranged the $1.6M sale of the newly built 2728 N Wayne Ave multifamily building in Lincoln Park.

LEASING

Contract packaging solutions provider VPL Logistics leased 167k SF at 3600 Amhurst Pkwy in Prudential Financial's Amhurst Lake Business Park in Waukegan. Paine/Wetzel/TCN Worldwide's Whit Heitman, Sam Badger, and Bradley Weiner repped the landlord, and Whit also worked on behalf of VPL. *** Home Products International renewed 330k SF in Midway Business Center at 5555 S Archer Ave. NelsonHill's Mark Nelson and Michael Nelson repped the owner, New Management, and Cushman & Wakefield's Sally Macoicz repped the tenant. Mark and Michael also repped the owner in Richwell Enterprises' 142k SF lease at Midway. Chicago Industrial Real Estate's Matt Rogatz repped Richwell. *** Marketing agency Commonground, repped by MB Real Estate's Andy Davidson and Boris Yelyashov, leased 24k SF at 600 W Fulton St and will relocate from 1035 W Lake St in July. US Equities' Jeffrey Barron repped the landlord. *** Rue21 leased 5,800 SF in Brixmor's Tinley Park shopping center at Harlem Avenue and West 159th Street.

FINANCING

CBRE Capital Markets' Tim Noonan, John Parrett, and Liz Henry secured $3M from a life company to refinance a 25k SF grocery-anchored shopping center at 3745 N Lincoln Ave.

CONSTRUCTION & DEVELOPMENT

McShane Construction broke ground on Essex Corp's 57-unit, 156k SF seniors housing project at 2220 Founders Dr in Northbrook, north of Willow Festival Shopping Center. The Society of The Divine Word owns the land. JSSH Architects designed the building, set to deliver in June '13.

Principle Construction completed a 184k SF TI in Romeoville's 1075 W Taylor Rd in Pinnacle Business Center for AP Taylor Road LLC, converting the 444k SF single-tenant facility into a multi-tenant building. Craig Slinker was senior project manager and Doug Brucato was superintendent. JLL's Trevor Ragsdale was the broker, Glavan Feher Architects provided architectural services, and DW Management is the property manager. *** Daveri Development Group's $13.2M Myers Place mixed-use supportive housing project has broken ground in Mount Prospect with 21 one-bedroom units, 18 furnished studio apartments, a state-funded services program for residents, and 3,560 SF of commercial space. UnitedHealthcare is providing $8M in LIHTC through a $50M partnership with Enterprise Community Investment. Illinois Housing Development Authority is providing $2M in LIHTC, Enterprise another $1.7M in LIHTC, Village Bank & Trust $1M in construction financing, plus funds from the Department of Commerce & Economic Opportunity, Corporation for Supportive Housing, the Housing Authority of the County of Cook, and the Regional Housing Initiative. *** Reed Construction completed a 26k SF buildout at 111 N Canal for Braintree Payment Solutions, which relocated from 833 W Jackson. Bryan Kreuger was project executive and Steve Sandquist was project manager. Partners by Design did design work. *** Clarion Partners and project manager Colliers International selected The Missner Group for a 77k SF TI and office buildout at 1400 Algonquin Rd in Briarwood Business Center in Mount Prospect, to deliver in early summer. Jess Knigge is the project executive, Jack Sbertoli the project manager, and Bill Stransky the superintendent. Colliers' Melissa Powell is handling construction management and Harris Architects is doing design work.

EXECUTIVE MOVES

Bruce Granger joined NAI Hiffman as SVP in its industrial services group from Grubb & Ellis.

REIT analyst vet Eden Levinson joined Harrison Street Securities as SVP from Duff & Phelps. *** Mark Katz joined HFF as a director, working on office investment sales in suburban Chicago. Previously, he worked for Gemstone Real Estate Partners, Colliers Bennett & Kahnweiler, JLL, and CBRE.

Read the full story 

To MB Real Estate president and private investor John Murphy, "B" is beautiful: he just purchased a Class-B Central Loop office building and refinanced another in the West Loop. Also enticing is the rare breed of upscale condos: He's completing construction of a super-luxury high-rise in Lincoln Park. (If there was ever a Match.com for investors and buildings, John would definitely have a "type.") We sat down with him to learn more.

Last week, John led a team of investors that closed on the $12.5M off-market purchase of 100 W Monroe, a 140k SF, 85-year-old Class-B office that’s 98% occupied. He tells us the idea of a dramatic conversion of use has been raised, but he sees an opportunity for a well-located, well-occupied Class-B office such as this. In fact, a couple of weeks ago, he completed the $58.5M refi of 200 W Jackson, which valued the 500k SF, 91%-occupied building at $92M. (In ’05, he led the group that acquired it for $47M.) Tenants include AC Nielsen and Enova, which leases 135k SF. Rents now range from $16/SF to $18.50/SF NNN, up from $11/SF to $13/SF in '05.

MB EVP Gary Denenberg, hard at work, directs leasing for the company, including John’s investment properties. John says that prospects for Class-B properties like his are brightening as the market tightens. During the slower market over the past few years, the flight to quality meant increasing vacancies for Class-B buildings. But as the market improves, occupancy is rising and rents are appreciating. Signs for the future are good, he says: White-collar employment is stabilizing and starting to increase, while the migration of companies to the city continues. At the same time, the cost of construction has never been higher. To him, that means a new 1M SF tower won't likely be delivered for 30 to 48 months, which will intensify demand for existing offices.

MB Chairman Peter Ricker and John are partners in Ricker Murphy Development, which is building Lincoln Park 2520, a 253-unit super luxury condo overlooking Diversey Harbor and Lake Michigan (reported to be a $375M project). Construction is slated for completion in June. The units, priced from $1M to $17M, are 50% pre-sold and that activity is getting stronger as the building opening approaches, according to reports. As far as John knows, no other condo projects of this scale are under construction in the city, and Lincoln Park buyers haven't been offered a new high-rise in 40 years.

Caution Still Rules Capital

Jenner & Block’s Don Horvath says that while the capital markets are improving, lenders are still being cautious with their underwriting. Don, who's moderating Bisnow's Chicago Capital Markets Summit on May 29 (your chance to register), says that for CRE investors prepared to accept a 50% to 70% LTV, a number of options exist, including banks and insurance companies that will lend at fixed rates. The low LTV ratios have kept many small and mid-market investors and private equity funds on the sidelines.

Joining him at the event is Heitman SVP David Maki, who joined the firm four weeks ago to help broaden its capital markets capabilities. David tells us that Heitman's core fund has experienced a significant inflow of new capital. As the recovery takes hold, he sees the office sector benefiting. As such, he says Heitman is strategically balancing its portfolio by adding office assets on the West Coast and continuing its focus on apartment investing. Hear more of David’s perspective at the event. Plenty of schmooze time, too! Sign up here

Lowe Enterprises Investors acquired the 28-story, 213-room Affinia Chicago Hotel at 166 E Superior St, one block north of North Michigan Avenue, from Denihan Hospitality Group. Lowe affiliate Destination Hotels & Resorts will manage it and rebrand it as MileNorth, a Chicago Hotel. It has 3,000 SF of meeting space, a ground-floor restaurant, and rooftop bar. The previous owner did a complete renovation, including conversion of several office floors into guest rooms.

A local family, repped by Interra Realty's David Goss and Jon Morgan, bought the 25-unit courtyard apartments at 809 Seward St in Evanston for $2.6M as part of a 1031 exchange. Interra's Brad Feldman repped the seller.

LEASING

The Cary Co, repped by Cawley Chicago's Tim Gallagher, leased 50k SF at Addison's 1005 Republic Dr as a satellite warehouse near its HQ. JLL's Dominic Carbonari repped the landlord, Cabot Properties. *** Mi's Teriyaki leased 1,715 SF in Napersville's 572 Weston Ridge Dr. Caton Commercial Real Estate Group arranged the deal. *** Lee & Associates repped the landlords in the following industrial deals: Test America, repped by Cresa, entered a long-term extension of 33k SF of lab and warehouse space at 2401 Bond St in University Park. Justin Fierz and Michael Androwich repped Midwest Industrial Funds. Ace Worldwide Moving & Storage Co, repped by Steiner Group's Nathan Schroder, leased 30k SF at 300 Airport Rd in Elgin. Ken Franzese and John Cassidy repped Northern Builders. Mach1 Global, repped by CBIZ Gibraltar's Eric Galanti, leased 24k SF at 2401 Internationale Pkwy in Woodridge. Jeff Galante repped ProLogis. Kratos Public Safety & Security Solutions, repped by Studley's Jon Azulay, leased 4,458 SF at 135 E St. Charles Rd in Carol Stream. Mike Plumb repped Pace Setter Investments. GY Industries renewed 11k SF at 358 W Armory Dr in South Holland. Brian Vanosky repped Cobalt Capital Partners.

FINANCING

Pembrook Capital Management loaned $15M at 67% LTC to 601 W Cos to buy the note and mortgage secured by 11 S LaSalle St, a 318k SF landmark Class-B office at the intersection with Madison in the Central Loop. Built in 1916, it has 31 tenants and was renovated for $15M in 2010. *** CBRE Capital Markets' Keith Huizinga and Molly Green secured $17.5M from a life company for Inland Real Estate Corp and Clarion Partners to refinance Schaumburg's 207k SF Woodfield Commons.

CONSTRUCTION & DEVELOPMENT

The Village Board of Orland Park chose HSA Commercial Real Estate as development consultant for its Main Street Triangle redevelopment project, a 32-acre pedestrian-oriented center between La Grange Road, 143rd Street, and the Metra Southwest Line for upscale shopping, dining, and entertainment. Flaherty and Collins recently broke ground on 295 luxury apartments on the southern portion of the site that will deliver in spring '13. *** The Missner Group has been selected to complete a 50k SF buildout for Jump America at 880 Lakeside Dr in Gurnee. It'll have two large trampoline courts, a dodgeball court, a kids’ court, two foam pits, a snack bar, a kitchen, and a private party. Jess Knigge and Bill Stransky are leading the project, which will open this month. *** Reed Construction completed a 6,500 SF interior buildout for Vein Clinics of America in Geneva's 1792 S Rand Rd. Bryan Kreuger and Matthew Mahoney managed the project: five exam rooms, a medical prep room, a doctor’s office, a screening room, ultrasound rooms, a break room, and shell space for expansion. CBRE assisted the owner, and HDR Architecture designed the project.

EXECUTIVE & COMPANY NEWS

Heitman hired David Maki as SVP for North American capital markets. He has 25 years of real estate experience, most recently in the same position for RREEF Alternative Investments. He has also been national head of real estate mezzanine finance for LaSalle Bank and managing director for Wells Fargo real estate merchant banking. *** RKF opened a Chicago office, joining its New York HQ, plus offices in Vegas, LA, Miami, Northern New Jersey, and San Fran. Managing director Anthony Campagni is the first on the personnel roster, coming from Baum Realty Group with associate Elan Rasansky. He began his retail real estate career at NY's Garrick-Aug Associates with many members of RKF's exec team. *** Avison Young hired a pair of Hoosiers, Erik Foster and Mike Wilson, (from Grubb & Ellis) as principals. Erik does asset advisory, dispositions, and sale-leasebacks, and Mike's experience is in capital markets for industrial and MOBs. *** ConopCo Property Management hired Liz Snell as biz dev manager. Her education is in architecture and environmental and civil engineering.

Marcus & Millichap Real Estate Investment Services promoted Jacob Gehl from VP to first VP of investments. He joined the firm in '99 and specializes in seniors housing.

Carl Knutson joined architecture firm Goettsch Partners as associate principal and senior designer, focusing on hospitality, mixed-use, and institutional buildings. He has also worked for Perkins+Will and Skidmore Owings & Merrill.

Scott Latter joined EnTrust Realty Advisors as an analyst. Previously, he launched a State Farm office in Aurora and has worked for TTX Co and Singlewire Software.

Horn Design promoted Kayla Dooley to senior designer. She joined the company in '08, working for clients like Advocate Physician Partners, Valtera, Lisle Chapter 13, Table XI, Standard Parking, Schawk, and Chicago Office Centers.

Ares Management senior partner Bruce Cohen tells us there's no shortage of equity in existing funds anxious to be deployed in CRE projects. (Equity gets really antsy when it's sitting in funds, twiddling its numbers.) But for equity providers, raising equity for new funds is a lot more problematic. Shameless plug: Bruce is a panelist at Bisnow's Chicago Capital Markets Summit on May 29. Register.

"If you're looking to raise your next fund, you're going into a marketplace with not as much capital, longer lead times, and a vastly more competitive atmosphere," Bruce says. Times are much more uncertain, and everyone is much more cautious. Even the most prominent fund managers in the country are having a hard time, Bruce explains. As for the debt side, he notes institutional-quality properties with stable cash flows are experiencing no shortage of long-term permanent debt. Among others, life companies, conduits, and the GSEs (for multifamily properties) are falling all over themselves to provide it.

REACH Social Raises $280k for City of Hope

Bisnow joined over 1,200 CRE pros at the 16th annual REACH Social at the House of Blues (we wouldn't miss it) and caught up with the event's organizers. We snapped Bisnow's Jonathan Hobfoll (overdressed as usual), Leopardo's Ruben Ruban, Golub & Co's Lee Golub, and Leopardo's Rick Dupraw. Rick and Lee were co-chairs of the event, which raised $280k to benefit pioneering research in cancer, diabetes and HIV/AIDS taking place at City of Hope. Of course, we had a little time to talk about real estate, too, and Lee told us that Golub is getting ready to break ground on its next high-rise rental development in Streeterville. It's also at work on a South Loop high-rise residential development and developments in Phoenix, Tempe, and San Francisco.

Attendees listened to performances by Dr. Bombay, Liquidated Damages, Mad Cow, Missing Ted, and Spaki, playing all the crowd favorites. Some of the crowd included Wilkhahn's Jessica Santos, Goby's Jenna Bruce, McCallum Architects' Neil McCallum, Wilkhahn's Amanda McCoy, our own Jonathan "Waldo" Hobfoll again, and Marriott's Kait Carlson.

The event was made possible by the volunteer work of the people in this pic, who remind you to attend next year (April 25, 2013). Top: MB Real Estate's Mark Buth, VOA's Jeannette Lenear, JLL's Bill Rogers, TVS Design's Marc Adelman, Associated Bank's Lisa Sawczuk, HFF's Jeff Bramson, Transwestern's Scott Becker, Partners by Design's Enza Parrella, and Walsh Construction's Tom Caplis. Bottom: Fifth Third Bank's Charles Krawitz, Power Construction's Pat Donley, Peregrine Group's Ward Feste, Lee, Rick, and MB Real Estate's Danny Nikitas .

Successful CRE Women Talk CRE

Another event we couldn't miss: the annual Successful Women in Commercial Real Estate Luncheon at Gibson's Steakhouse, hosted by the Chicago Association of Realtors Commercial Forum, with the Goldie B. Wolfe Miller Women Leaders in Real Estate Initiative, Roosevelt University and the Women’s Council of Realtors, Chicago Chapter. Pictured are the event's panelists: Millennium Properties' Susan Silver, Lawton Realty Group's Heidi Lawton, moderator Collete English Dixon of Prudential Real Estate Investors, Westfield's Velda Turan, and CBRE's Sharon Kahan. Among other insights, they pointed out that US malls are beginning to adopt a more European model by including groceries. (Might we see frites and sausage in the food court?) Research consistently shows the presence of a grocery increases the frequency of mall visits and length of shopping time.

New Owners Plan Yorktown Upgrade

After years of investing in other things, the deep-pocketed KKR has formed a real estate investment arm, and the very first property it bought was Yorktown Center in Lombard for $196M, along with partner YTC Pacific. Until it was sold, the 1.5M SF Yorktown represented an increasing rarity in the world of US regional malls—it had been privately owned since its development more than 40 years ago. The new owners plan to make some improvements and find tenants that complement the existing mix but plan no radical change, according to Pacific Capital Retail Partners managing principal Steve Plenge. (Pacific and Collarmele Partners joined forces to form YTC Pacific.) Steve tells us that the goal is increase the mall's productivity of $350/SF to $400/SF in the next two years.

Read the full story

Since 1992 when Quintin Primo founded Chicago-based Capri Capital Partners, he has managed some $3.6B in assets on behalf of pension fund and institutional clients. His success as an entrepreneur and business leader (the Primo Center for Women and Children has raised over $5M in the last three decades) is legendary.

And on May 29, he will join Pearlmark Real Estate Partners co-founder and CEO Stephen Quazzo and other such luminaries for our Capital Markets Summit in Chicago. (Above, Quintin with President Obama. He tells us he's known the President since he was an Illinois senator and served on his national finance committee in 2008 and serves on the Illinois finance committee for 2012.) Today, we bring you this exclusive preview:

Bisnow: How much capital do you expect to deploy this year compared with last year? Quintin: Between $600M to $700M gross this year, sharply up from 2011, which was roughly half that, $300M to $400M gross in 2011. Many of the institutional investors, particularly pension funds, are increasingly interested in the separate account format versus the private equity format for three reasons: 1) greater control with an ability to own assets longer, have more direct discussions in terms of modifications to the investment structures and underlying debt; 2) the realization that your fellow limited partners can have a dramatic impact on how those funds are managed, particularly in adverse circumstances; and 3) a realization that anything that can be done in a private equity format can also be done with a separate account format. Bisnow: What are institutional investors looking for in this market?   Quintin: Institutional investors, first and foremost, want income from US real estate investments, which provide portfolio diversification, resilience and returns, so especially in this market they want even more exposure. That’s also why pension funds have sought to develop separate accounts with US advisors like Capri to pursue income property investments in the US. Multifamily has proven to be  most resilient on a secular basis. Returns on institutional core assets are between 7% to 9%.

Bisnow: Last month, Capri acquired the 23-story 360 Residences (above) in San Jose, Calif. for $118M on behalf of investors. What was the strategy there? Quintin: It was the quintessential urban multifamily play. San Jose is a very vibrant, growing market. 360 is a well-located, relatively new building that we were able to acquire at a very good price. The strategy for investors is to give them the highest possible quality of real estate to include in their portfolios. That transaction was done in one of our large separate accounts. California and coastal markets are always attractive—they’re hard assets to get a hold of—when you are successful in acquiring them, they’re assets that you tend to want to hold for the duration. Many investors are now realizing these assets are so hard to acquire, they desire to hold them for as long as 10 to 15 years. Bisnow: What is the “shifting paradigm” in multifamily real estate demand? Quintin: US demand is driven by different demographic factors than other Western developed countries. A third of our population is under the age of 25, roughly 100 million people, coupled with overall population growth of 1% per year, which is very beneficial to our economy. Those two stats mean multifamily will continue to soar over the next 10 to 15 years. Prime urban multifamily demand comes from the population of 21- to 34-year-olds, and we have plenty of those individuals here in the US that are renting. Why? There’s no quick rush to own a home. They have a desire for mobility and don’t want to be tied down by cost or inflexibility that home ownership provides.

North Bethesda Market

Bisnow: What does the European sovereign debt crisis mean for the US capital markets? Quintin: First, it impacts the global flow of funds. Given serious clouds over the Eurozone economies, that capital is moving out of Europe and into markets like the US. Second, the overall issues with the European economies (Britain just officially went into a double dip), especially the economies of Greece, Italy, Spain, Portugal and earlier, Ireland, have caused major issues on the periphery and are potentially bringing and spreading it by contagion into more stable countries. All of this, with austerity measures being aggressively taken by sovereign governments (aggressively recommended by Berlin), is causing economic headwinds for the US given that Europe remains a major trading partner for us and our financial systems are very much linked. Our banks are linked. Bisnow: Can you share a personal anecdote about yourself?   Quintin: The charity that I’m most passionate about is the Primo Center for Women and Children. And we recently had a Valentine’s Day bash to raise funds for the center and I had the great pleasure of playing the keyboards in my daughter’s band for its Chicago debut. She has a heavy metal rock band at the tender age of 15 that’s on its way to fame and fortune.

HOTELS ARE HOT

Oxford Capital’s plan to restart construction of the stalled 216-room mid-market hotel at 127 W Huron St and reprogram it as an upscale hotel means that by next summer this eyesore will tranform into a cutting-edge building. The project also points to the strengths of Chicago’s hotel market. PKF VP Mark Eble says that the location is great; the area is hot, filled with nightlilfe, residential, retail, and other hotels. Oxford’s decision to go upmarket conforms with PKF’s latest Chicago research. In ’11, higher-priced hotels outperformed the lower-priced ones. Overall, Chicago hotels had a RevPAR gain of 8.8%, compared with 8.2% for the US as a whole. This year, PKF expects the city’s RevPAR to grow 8.3%.

Read the full story

BIG DEAL! CME Group sold two of the three Chicago Board of Trade buildings at 141 W Jackson (north and south towers, 1.3M SF) to GlenStar Properties and USAA Real Estate for $151.5M. CME will lease back 150k SF, including the Agricultural Trading Floor, for 15 years and continue to own and occupy the 288k SF east building, which will become 333 S LaSalle St. Holly Duran Real Estate Partners' Holly Duran and Jeff Mulder, JLL capital markets' Bruce Miller, Jim Postweiler, and Nooshin Felsenthal, and Goldberg Kohn's Jim Rosenbloom and Mike Manuel assisted CME.

SALES

The fully occupied Northpointe II Office Center at 465 Central Rd sold for $1.8M. Marcus & Millichap's Frank Roti repped the seller, and National Realty Network's Charlie Pick repped the buyer. *** Acadia Realty Trust acquired the Gold Coast Lululemon for $20.7M. Its Fund III also closed on its acquisition of the 63k SF Lincoln Park Centre in the Clybourn Corridor for $31.5M, closing out the $171.3M fund's pipeline. *** Strauss Realty sold a 24k SF development site at 3636-3656 N Western Ave for $1.4M in a lender-assisted sale.

LEASING

Xpedx leased 316k SF in Liberty Property Trust's 901 Bilter Rd, known as Liberty Business Center #7, in Aurora. The tenant, repped by Hartford Associates' George Pappas, will relocate from Glendale Heights. Rockpoint Logistics, repped by Newmark Grubb Knight Frank's David Friedland, also expanded by 72k SF to 292k SF. Colliers' Jim Estes, Jeff Kapcheck, and Mark Bell repped Liberty, bringing the 608k SF building to full occupancy.   ***   Goodman Manufacturing, repped by Paine/Wetzel/TCN Worldwide's Elise Couston and Stream Realty's Seth Koschak, signed three area industrial leases:   29k SF at Northbrook's 3500-3600 Woodhead Dr. CBRE's Zach Graham and Keith Puritz repped ProLogis. 23k SF at Rolling Meadows' 3121 Tollview. Paine/Wetzel's Elise Couston and Les Spinner, repped landlord Chicago Properties. 20k SF in Mundelein's 1060 High St. NAI Hiffman's Steve Sullivan repped ML Realty Partners. Paine/Wetzel also completed four suburban leases: Divane Brothers took 32k SF at 2401 Grant St in Bellwood, relocating from the city. Jeffrey Girling and Terence Lynch arranged the deal. Brown Paper Goods, repped by CBRE's Ryan Bain, took 27k SF in 3630 Burwood in Waukegan's Amhurst Lakes Business Park. Its HQ is at 3530 Birchwood. Paine/Wetzel's Whit Heitman, Sam Badger, and Brad Weiner repped Prudential. ABW Cos signed for 6,796 SF in Mokena's 9960 W 191st St, relocating from Orland Park. Paine/Wetzel's Edward Wabick repped the tenant, and Value Industrial Partners' Brian Gedvilas repped VIP Mokena Crossings. Huetone Imprints leased 5,700 SF in Elk Grove's 90 Lively in Elk Grove. Elise Couston repped Chicago Properties, and Brown Commercial Group's Mike Antonelli repped the tenant.

FINANCING

Marquette refinanced its 94% occupied, 390k SF HighPoint Community Apartments in Romeoville for $36.8M with an 80% LTV, 35-year HUD loan arranged by Berkadia Commercial Mortgage's Len Deering, Paul Matusiak, and Tom Sigrist. *** Inland Real Estate Corp and Clarion Partners refinanced its 176k SF Chatham Ridge retail center with $18M from a life company. CBRE Capital Markets' Keith Huizinga and Molly Green arranged the loan.

CONSTRUCTION & DEVELOPMENT

Bluestone Diversified Investments received final development approval for an 11k SF, Class-A shopping center in Highland Park in which AT&T will occupy 5,000 SF. General contractor Bulley & Andrews has begun construction on the Knight E/A-designed project, which will deliver in August.

Cushman & Wakefield's 40k SF Illinois HQ on the 27th and 28th floors of 200 S Wacker Dr is done. It relocated 110 people from 455 N Cityfront Plaza Dr. The project team included C&W's Shawn Mobley, John Haas, and Randy Thompson, Whitney Architects' John Burjek and Paula Lutz, Environmental Systems Design's Efren Molina, and Design Solutions' Daniel Mazeiro, Michael Nolan, and Bob Shor.

Krusinski Construction Co completed the renovation of IAC’s Chicago Market Center in Hodgkins for Global Experience Specialists, including 43k SF of office and a 247k SF warehouse and production facility. Ware Malcomb was the architect.

***

Principle Construction will renovate 3,650 SF and add 20k SF at Subco Foods' 1150 Commerce Dr in West Chicago. Craig Slinker is senior project manager, and Corporate Design + Development Group is doing the design work. *** J.C. Anderson completed a 40k SF interior renovation at GlenStar Properties' 8700 W Bryn Mawr for Fidelity Life Association, which is consolidating its Oak Brook and Rolling Meadows locations. Joe Maguire was the project manager and Glen Panfil the superintendent. DePalma Group designed the project. *** Reed Construction completed a 15k SF expansion for Gogo’s Itasca office. Bryan Kreuger was project executive and Steve Sandquist project manager. Partners by Design did the design and CBRE repped the owner.

EXECUTIVE MOVES

Transwestern has promoted Rob Bagguley, until now Midwest prez, to chief innovation officer. He'll also lead the firm's Middle East and North Africa strategy. He has also served as senior managing director for Cushman & Wakefield and founded Rubicon Property Services.

Mike Watts has joined Transwestern from J.F. McKinney & Associates to take Rob's spot as Midwest prez. He's also worked for JLL.

ML Realty Partners hired Enrique Nevarez Jr as director. He joins from ProLogis.

***

Sara Schumacher has joined J.C. Anderson as project manager in the Elmhurst HQ and Downtown office. It's a family affair. Matthew Schumacher joined the firm as a skilled plasterer in the '40s, his son Joseph bought it in '76 and has transferred leadership to his sons, Jim (Sara's dad) and Tom. Sara is the first female in the family to join. She has also worked as an interior designer with Gensler and as a designer with Hydzik Schade Associates. She graduated from the Illinois Institute of Art. *** Op2mize has hired Paul Fishbein as EVP and Aaron Paris as chief intelligence officer. Paul has worked for Centrum Properties, Amerimar Enterprises, and Indie Energy Systems. Aaron has worked for DP Partners, Metropolitan Structures, and Tooley & Co, and he has an MBA from Northwestern University. *** Kudan Group hired Alex Stamatakis, who has worked for the Chicago Board of Trade and as a slot marketing executive, opening the Bellagio for Steve Wynn. *** Bradford Allen promoted Ben Azulay and Joel Berger from directors to senior managing directors. Ben will lead the downtown brokerage team and Joel the suburban brokers.

The broker panel at Bisnow's Chicago State of Office at Trump Chicago on Tuesday had a lot on its mind: office leasing, naturally, but also economic development in the city and the mayor's role in it; the city vs. the suburbs; and even the prospect of CBD office development. Surprisingly, most of the panel thought that Chicago is very likely to see a big new tower by '16 or '17, despite the relatively middling occupancy and leasing picture Downtown.

JLL managing director Steve Smith (right) said that he thought the race was already on to build something new in the CBD (a "space race" for new millenium), targeting anchor tenants with lease expirations from 2015 to 2017, though such a development might be smaller than generally expected, 400k SF or so. But in any case he expects it to be in the West Loop. The first building out of the ground ought to do reasonably well, he predicted, despite the fact that leasing in the market isn't robust. Securitization of leases is still "alive and well," Steve added, and he doesn't expect that to change.

Tishman Speyer's managing director Vicki Noonan agreed that with the improving economy, she wouldn't be surprised if someone announced a new development by the end of the year. Of course there still would be competition from existing assets in the marketplace, a number of which still have blocks of vacant space that can be reconfigured and modernized for users who might otherwise consider anchoring something new. Existing space, in other words, is still a contender.

As an office market, Chicago has staying power that isn't entirely explained by economics, Studley EVP Joe Learner told the audience. Illinois is a high-tax state, for one thing, and the region's infrastructure is a bit frayed. Still, Chicago has a location, transportation network, educational and cultural institutions—and a fine urban vibe—and its office assets can compete with anything on either of the coasts. The city also happens to have a tireless promoter in Mayor Rahm Emanuel; one of whose main focuses in office has been to bring jobs into the city. The rest of the panel agreed with that assessment of the mayor, noting with surprise that he's even reaching out to the CRE industry to achieve his job-growth aims.

MB Real Estate EVP Andy Davidson said that Chicago is indeed well-positioned to take advantage of job growth in the industries that will continue to expand, such as healthcare. The city also has an edge in what he called "secondary leasing" by major tech companies, with Google being a prime example. No one is expecting Google or any other major tech player to pull up stakes and relocate to Chicago, but the company has leased a major amount of space in the city, recognizing its importance in the greater scheme of commerce—and the fact that it's easier to find talent here than in a lot of other places.

CBRE executive managing director Chris Connelly said that most of the advantages of being in Chicago are enjoyed by office properties in the CBD. The 'burbs, on the other hand, are having a harder time of it, and that shows in a vacancy rate that's roughly 700 bps higher in suburban Chicago than Downtown. Corporate migration from the suburbs to the city has been a factor in that, he said, but more important in driving CBD leasing is organic growth among local companies and companies from outside the area. When an employer wants to catch the attention of younger workers—the next generation of office space users—it's more likely to locate in the city than the suburbs.

The panel, expertly moderated by Quarles & Brady partner Ted Yi, also touched on some of the hotter submarkets Downtown—the West Loop, for one, has been seeing a bit of action lately—and the uncertainties posed for office space as the next generation of office workers comes of age. Some of the previous radical visions of hoteling and mass downsizing of office space (no place for anyone to sit, ever) haven't come to pass, but there's no doubt that younger workers will interact with their office space differently than the increasingly fogey-fying baby boomers. It's still an open question as to how that generational shift will affect demand for space.

US Equities Realty SVPs Bill Vail (left) and John Simon told us that business has been picking up lately for the company, which manages and leases properties mostly in the Chicago area. And they're not alone: According to a recent report by the company, the Downtown vacancy rate in Q1 was 14.1%, down from 15% a year earlier.

Bisnow sponsor PTG Paradigm Tax Group also reports that business is brisk, which should be little surprise, since finding lawful ways to reduce one's property tax burden is going to be popular no matter what else is going on. Pictured from left are PTG's Steve Newman, Nicholas Hunter, and Robert Dunlap.

Another Bisnow sponsor showing its stuff at State of Office was RealView, maker of the RealView Mobile Inspection Program. Above, RealView EVP David Howorka demonstrates its mobility.

Read the full story 

Read the full story 

Yesterday, more than 400 packed the ballroom of Trump Chicago (as in, standing-room only) for Bisnow's Chicago State of Office. (And only a few of those people thought it was a conference on the future of NBC's The Office, so nobody was too disappointed.) A good many questions were tossed out for the developer panel, but maybe none so juicy as the simplest ones: Will there be any big office developments in Chicago in the next few years? Should there be?

Most the panelists said that conditions were getting better for Chicago office development and that maybe the time would be soon. (The office market is like pears—if you don't get them just right, they are either really mushy or hard as diamond.) But none would commit to pulling the trigger themselves, though some of them have well-known plans to do so, once financing is squared away.

Rich Gatto noted that growing tech companies are still interested in Chicago. Google, for instance, took a single floor of a Downtown building 10 years ago and has grown to over 150k SF since—and is still growing. But if there's any Achilles' heel, he warned, it's that most tech companies are growing their sales forces here, not so much their engineers, so Chicago still needs to promote the kind of environment that will attract the tech end of the tech business.

Trammell Crow principal Grady Hamilton told the audience that Chicago companies have quit shedding space in a state of worry (sometimes panic) about what would come next. That trend, along with the relative strength of the recovery and Chicago's longstanding role as a hub of commerce, all bode well for leasing in downtown. That improves the likelihood of new development, especially as large space users become restless in their old space. But there are still things that might hold the office market back: Job growth might stumble again and low interest rates will have to go up sometime.

Fifield Cos COO Kevin Farrell illustrated for us that declining unemployment (or from the looks of Kevin, reclining unemployment) will have a favorable impact on Chicago office vacancies, though progress has been slow for both employment and office occupancy. Considerable uncertainty remains among businesses, however, sometimes to the point of holding back hiring decisions. It's hard, for example, to know the cost of doing business in the current uncertain tax climate, Kevin said, which makes hiring that much harder. (And most companies don't have the time to go through complicated reality shows like The Apprentice to find talent.) As for the office investment outlook, he explained that (with certain exceptions), office buildings aren't being bid up yet. Offices are management-intensive, and for now investors have a stronger appetite for fixed-income investments.

Zeller Realty CEO Paul Zeller stridently disagreed with the notion that there's going to be much Chicago office development in the next few years, because the fundamentals don't support it. Unemployment is higher than the official numbers, interest rates are going to go up eventually, and the next generation of office space users won't use as much space as previous generations, he said: "Add it all up, and we have plenty of stuff built.

Paul also bemoaned the loss of local control when it comes to Chicago office properties. If CMBS makes a comeback, and there are some indications that it will, he warned that would mean that "the control of another generation of Chicago assets would be lost to New York." Finally, a shout out to the Reznick Group's George Klenovich (above), who ably moderated the developer panel.

Colliers International principal Drew Neiman (center), with panelist Rich Gatto and White Oak Realty Partners partner Thomas Saletta, told us that "the usual suspects" are indeed out looking in the Chicago CBD for large chunks of office space—law firms, for example, which might take several hundred thousand feet in a new building, possibly jump-starting a new development.

JLL VP Brian Atkinson (left), with Hearn EVP Blake Hillemeyer, told us that Downtown Chicago leasing has picked up recently, spurred by the sectors of the economy that are still growing. Brian, along with JLL's Nikki Kern, repped the owner of 10 South Riverside Plaza late last year in one such deal, in which an employee benefits software specialist more than doubled its space by making the move into the building, the better to accommodate growth and attract new talent.

Bisnow sponsor LifeStart is growing, too. The corporate fitness company has three new locations in the works in Downtown Chicago, including one opening at 222 North LaSalle in about two weeks, according to president Mike Flanagan, here with director of operations Sharon Mehalek.

Read the full story

Aries Capital chairman Neil Freeman tells Bisnow that he doesn't believe lenders have overinflated the multifamily market yet. He'll expound on that and more at our Chicago Capital Markets Summit on May 29 at the Westin Chicago River North. (Register!)

Neil (left, with Aries SVP Jeff Bucaro and a rude, photobombing ram) says between 2008 and 2012, there was very little new construction for apartments and virtually no condo units in Chicago. So there's demand for apartments, he says, adding that with household formations, less tenant turnover to buy homes, and an improving job market, the additions to the city's apartment stock through 2014 or 2015 should be absorbed. But not all is rosy for multifamily: "Rent increases, while aggressive in 2012, may not be as robust as developers are projecting in 2014." As for other property types, Neil believes there are some good repositioning opportunities and lenders are starting to recognize these: "There is ample money from non-banks for loans at good rates for stable properties with good cash flow."

Inquiring CRE Minds Want to Know

Quarles & Brady real estate attorney Ted Yi, seen here in high places with his son, will moderate at Bisnow's State of Office event on April 24 at Trump Chicago. He'll guide the panelists through some thorny subjects, such as does Downtown need any more office space—or, more to the point, when will it need new office space? When will lenders go along with it? Who has the upper hand today: tenants or landlords? Will that be changing any time soon? Are tenants still "rightsizing"?  Do tenants and landlords still have significant credit issues? Will the suburbs lose tenants in any appreciable numbers to the city? Ted wants to know (and so will the audience).

Chicago Medical Office Opportunities

Multifamily might be getting most of the glory now, but MedProperties Group investment management director Jesse Ostrow says that we shouldn't lose sight of the still-rich possibilities in medical office development. (The MOB doesn't like to be forgotten.) His company certainly isn't ignoring the possibilities, considering that it's at work on a three-story, 75k SF MOB on the North Side of Chicago. The population is aging, of course, but Jesse says there's more to it than simple demographics: "There's increasing demand for more efficient outpatient, off-campus facilities, and that's not going to change. Establishing off-campus properties with primary- and urgent-care capabilities allows health systems to add patients while lowering occupancy costs."

DALEY DISH

He may be retired as mayor, but Richard Daley sounds as busy as ever these days: he's of counsel to Katten Muchin Rosenman, a distinguished fellow at the U of C, on the board of Coca-Cola, co-chair of the 100,000 Strong Initiative, and much more. Yet he found time this week for a one-on-one with Centerpoint Properties cofounder Mike Mullen at the Downtown Chase Bank Auditorium. Da Mayor covered a lot of ground, bemoaning hyperpartisanship in Washington, enthusing about US-China ties—he just spent 17 days in Hubei Province on business—positing that the US needs to expand manufacturing. He also discussed CRE from his new vantage as a member of IndCor's board. The most important day for a successful politician: Saturday. "That's when you meet the people," he says. "If you don't get out on Saturday and hear what the people think, you'll go nowhere." (Also you get to see Saturday Night Live.)

We also caught up with Mike Mullen, McShane Construction's Jim McShane, and FCL Bulders' Mike Boro. Jim told us about his recent trip to Bangladesh as a member of the board of directors of Concern Worldwide, an NGO that concentrates its development efforts on the world's poorest and least-developed countries. "It's important to support charitable work in this country but equally important to do the same in other parts of the world," Jim says. "The depth of poverty in a place like Bangladesh is truly staggering."

Chicago's Getting a Winery

Will Chicagoans take to the City Winery the way Manhattanites have? The winery's CEO Michael Dorf, here with Chicago adlerman Walter Burnett, certainly hopes so. Since it opened in '08, the original NYC location has produced about 1.8 million glasses of wine (1,400 barrels, but we think the number of glasses is more toast-worthy). Work began on the 1200 W Randolph location recently, taking advantage of the fact that there are still shells of former industrial buildings in that part of town ready to be reinvented. Glasses will first be raised at the 33k SF winery (the city's only one) and restaurant in August.