PALATINE, IL – RealEstateRama – Hanley Investment Group Real Estate Advisors, a nationally recognized real estate brokerage and advisory firm specializing in retail property sales, announced today that the firm has completed the sale of a new-construction, two-tenant, retail pad building occupied by an Aspen Dental-branded practice and T-Mobile in Chicago’s desirable northwestern suburb of Palatine, Illinois. The sale price was $3,130,000.
Hanley Investment Group Executive Vice Presidents Jeff Lefko and Bill Asher, along with Greenstone Partners Greg Dietz and Danny Spitz of Chicago, represented the seller, a Chicago-based real estate investment and development firm. The buyer, a private investor from San Jose, California, was represented by RML Management, Inc. of Santa Clara, California.
Located at 960-968 E. Dundee Road in Palatine, the two-tenant property is prominently positioned at the high-visibility intersection of Dundee and Rand roads with nearly 55,000 vehicles per day. The brand-new 5,250-square-foot building, which was completed in 2019, is situated on 0.67 acres in a thriving and mature commercial corridor with national retailers including Walmart, Home Depot, Target, TJ Maxx, HomeGoods, Petco, Aldi, Jewel-Osco and more.
Aspen Dental occupies 3,500 square feet and T-Mobile occupies 1,750 square feet. Both Aspen Dental and T-Mobile have new long-term, triple-net leases with 10% increases every five years.
“We generated multiple competitive and qualified offers immediately after bringing the property to the market,” said Lefko. “Investors were attracted to the quality of the tenants, long-term leases and the newly minted, triple-net leases.”
According to Asher, the trade area offers superior density and demographics with a population count of 252,000+ and an average household income of nearly $120,000 within five miles of the property. Palatine is located 30 miles from the Chicago Central Business District “Loop” and 14 miles from O’Hare International Airport. Convenient transportation options for commuters include Metra rail service and access to major expressways such as I-90, I-290, I-294, Illinois Route 53 and U.S. Highways 12 and 14.
Lefko Adds “Palatine is an interesting market because its primary retail corridor feeds into both an affluent and mid-level average household income population. It is rare for a retailer to be able to penetrate two demographic pools with one location. More and more retailers are expanding in Palatine through renovated or new construction buildings along Rand Road and Dundee Road.”
Since it was founded in 1998, Aspen Dental has grown consistently in response to the unmet need for accessible, affordable, and comprehensive dental care. Today, an estimated 25,000 patients receive care in an Aspen Dental location every day and there are nearly 12,000 team members across the country. Unlike most dental support organization-supported practice, Aspen Dental’s growth is entirely de novo, meaning that every office is built from the ground up rather than via acquisition, a strategy designed to create a consistent patient offering from office to office. With 800 offices in 42 states, Aspen Dental practices provide a wide range of general dentistry and denture-related services and offer patient-friendly programs and services, including convenient locations, onsite labs and extended hours. Together, Aspen Dental practices cared for nearly 1.8 million patients in 2018.
Each Aspen Dental-branded practice is owned and operated by a licensed dentist. Aspen Dental Management, Inc. (“ADMI”) provides administrative and business support services to Aspen Dental-branded dental practices including recommendations related to finding the right locations, leasing, acquiring equipment, accounting and marketing. ADMI licenses the “Aspen Dental” brand name to the independently owned and operated dental practices that use its business support services.
T-Mobile US, Inc. (Nasdaq: TMUS), commonly shortened to T-Mobile, is a United States-based wireless network operator whose majority shareholder is the German telecommunications company Deutsche Telekom (DT). T-Mobile is the third-largest wireless carrier in the United States, with 84.2 million customers and service revenues of $8.6 billion as of the end of the third quarter of 2019. The total full-year 2018 revenues were $43.3 billion. Based in Bellevue, Washington, T-Mobile US provides services through its subsidiaries and operates its flagship brands, T-Mobile and Metro by T-Mobile.
On December 20, 2019, the U.S. Federal Communications Commission (FCC), a five-member independent agency of the U.S. government regulating interstate network communications, voted 3 to 2 to pass a Sprint, T-Mobile merger, a $26 billion merger of T-Mobile and Sprint, the United States’ third- and fourth-largest wireless carrier respectively. On December 2, T-Mobile launched its nationwide 5G network, covering more than 200 million people and more than 5,000 cities and towns across the country. This launch immediately catapults T-Mobile into the leadership position as the country’s biggest 5G network, covering more than one million square miles, much of that in rural America. With the merger with Sprint, the New T-Mobile will be able to build on this foundation to deliver transformational broad and deep 5G for all.
Earlier in 2019, Lefko and Asher arranged the sale of the TCF Bank situated across the street at Park Place Shopping Center for a 5.50% cap rate, representing a record-cap rate for a non-renovated bank in the Midwest. Lefko and Asher have become one of the top three most active net-lease teams in the Midwest with over $400 million in Midwest transaction volume, many at record-low cap rates and the highest price per square foot. Lefko and Asher recently sold a very high-profile, two-tenant Bank of America property in Maple Grove, Minnesota, to an all-cash buyer based in Southern California. This sale is significant because, at the 5.66% cap rate, it set a record for the highest price per square foot for a multi-tenant property above $7 million to sell in the Midwest. This sale occurred a few weeks after Lefko and Asher sold the lowest-cap rate multi-tenant property in the Midwest, which featured Chipotle and Starbucks in Chaska, Minnesota.
“These recent sales serve as examples of highly aggressive California buyers coming to Midwest markets and paying a premium for new construction on A+ sites,” Lefko noted.
About Hanley Investment Group
Hanley Investment Group Real Estate Advisors is a retail investment advisory firm with a $6+ billion transaction track record nationwide, who works closely with individual investors, lending institutions, developers, and institutional property owners in every facet of the transaction to ensure that the highest value is achieved. For more information, visit www.hanleyinvestment.com.
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