Seefried clears 35 acres by O'Hare for industrial

The most telling bid for functionally obsolete office in the O'Hare submarket may now be the kind that arrives with a demolition budget, and Seefried Industrial Properties has just finished making it on a 35-acre Des Plaines site where three functionally obsolete office buildings stood. Three industrial buildings totaling 520,000 square feet are going up on the cleared ground, with delivery set for the second quarter of 2027.

The land sits at the northeast corner of Algonquin Road and Mount Prospect Road and will carry facilities of 260,000, 152,000 and 106,000 square feet, with Premier Design + Build Group as general contractor, SPACECO as civil engineer and Harris Architects as project architect. CBRE's Jason Lev, Jimmy Kowalczyk and John Suerth are marketing the space, and Doug Houser of Seefried described the location as supply-constrained, a claim the leasing campaign will test once the buildings deliver.

The project's weight lies less in the square footage than in what it says about the exit for older office, and PWD has tracked the conversion trade for months. The CBRE-brokered Merritt 7 sale in Norwalk priced two office buildings as apartment feedstock, with the buyer's 286-unit plan backed by a $75.5 million construction loan from OZK; Midtown's 1411 Broadway ran the other way, where $100 million of renovation capital won more than 182,000 square feet of leases, evidence that repositioning still pays where rents are deep enough to carry it.

Des Plaines is a third outcome: no re-tenanting here, no residential program, just a teardown into the product that industrial capital keeps bidding for. For anyone holding functionally obsolete office in the inner suburbs, the strongest bid may now come from a developer who wants the dirt and nothing standing on it, rather than from an office landlord betting on a re-lease. That bid does not care about the rent roll, the leasing pipeline, or the cost of a lobby renovation; it is a land-basis trade against the spread between industrial rents and the cost of a new shell.

Office is repricing asset by asset rather than by index, and each non-trophy trade widens the comp set. The Des Plaines conversion supplies a comp that suburban office owners and their appraisers have had little practice with: ground valued for its truck courts. The test arrives with the next obsolete campus that trades in the O'Hare submarket, and whether the buyer shows up with a leasing plan or a demolition crew.