Tucker Development buys Quality Foods property in Fulton Market area

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A Highland Park developer is paying an estimated $52 million for almost an entire block in the Fulton Market neighborhood, paving the way for a messy redevelopment in one of the city’s most changing neighborhoods.

Tucker Development has reached an agreement to purchase the property, which includes 11 buildings on and around West Randolph Street and parking for future development, CEO Richard Tucker confirmed. He declined to disclose the price, which sources say is around $52 million, or to discuss specific development plans.

“We think it’s a fantastic market, and it’s only getting better,” Tucker said. “Restaurants and retailers that have opened are doing very well. We think we can add quality uses to those that already exist. We are thrilled to be part of this growth area of ​​the city.

Tucker buys the property from the Aralis family, owners of Quality Food Products. The food wholesaler occupies part of the property’s 102,512 square feet.

Chairman George Aralis declined to comment on the sale or say whether the company plans to remain in business at another site. The family has previously discussed move to a site he owns less than three miles southwest of his buildings at 912-926 W. Randolph St. Many other food wholesalers and meat packers have already benefited from rising property values and moved elsewhere.

Listed for sale by Los Angeles-based CBRE, the property has attracted strong interest from developers, who are already flocking to the longtime meatpacking and food distribution district. The buildings and a 20,624 square foot parking lot are bounded by Randolph, Sangamon, Lake and Peoria streets.

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CBRE Senior Vice President Keely Polczynski confirmed the property was under contract, but declined to comment on the buyer or the price. She said CBRE brokers had arranged more than 70 property viewings which resulted in more than 20 written offers.

The property includes retail businesses overlooking the Randolph Street restaurant row, where retail rents have doubled over the past three years. It’s near Google’s new headquarters in the Midwest, the Soho House private club and hotel and the CTA station at Morgan and Lake streets.

Besides Chicago-based Sterling Bay, the region’s most active developer, whose projects include the new 1K Fulton offices, based in New York madison capital and based in Chicago McCaffery interests– known for their big projects in well-established areas of big cities – have also bought large properties in the region this year.

“It was the last major site available to build something dense, so it will put them in a unique position,” said Scott Maesel, executive managing director of Sperry Van Ness, who is an active broker in the area but does not is not involved. in the Quality Food real estate sale. “It’s rock star real estate, but it has many unknowns. You need to be a savvy and creative developer to make this deal, while being well funded. »

Ten of the 11 brick structures contribute to the buildings in a Historic District the city created this year in response to the rapid changes in the district. That means most low-rise buildings can’t be torn down and replaced, limiting potential profit opportunities, according to people familiar with the property. The buildings will likely be reconfigured for commercial tenants.

HIGHER STRUCTURES ALLOWED

Although most of the existing buildings are historic, the property benefits from its location in an area that allows for new, taller structures in the new part of town. land use plan. Tearing down the only noncontributing structure and building on it and the parking lot, Tucker could build about 300,000 square feet there, based on comparisons of office and 11-story apartment proposals by Chicago companies. Development of Shapack and MCZ development which won the city’s approval.

Tucker’s plans for a new taller building, possibly for apartments, would need Ald’s support. Walter Burnett (27th) and the city.

The Quality Food site could also qualify for incentives under the city’s program Transit Oriented Development Ordinance, which encourages residential and commercial development near public transportation.

“You’re going to have to figure out how to deal with the Department of Planning and Development, the historic district, neighborhood groups and Alderman Burnett,” Maesel said. “I have not seen a property with so much dynamics.”

Tucker is developing properties in the Chicago area and New Jersey. Retail projects in the city have included the South Loop Marketplace and the Marketplace at Six Corners at the intersection of Irving Park Road and Milwaukee and Cicero Avenues.

This year, Tucker Ventures bought the Wheaton Town Square mall for $57.3 million and sold the Yorkville Market center for $24.1 million.

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