Chicago Retail Construction Report

Second Quarter 2008

2008 Estimated Completions Market Facts

Metro U.S.
Population 9,573,949 301,825,750
Total Households 3,375,144 113,136,906
Median Age 35.5 36.7
Median HH Income $63,393 $51,680
Retail Vacancy* 9.2% 10.2%
Avg. Asking Rent/Sq. Ft.* $20.00 $20.04
* Year-end 2008 Forecast

Construction Pipeline
Projects Sq. Ft.

Est. 2Q 08 Completions 22 969,000

Est. 1H 08 Completions 61 2,534,000
Est. 2H 08 Completions 22 3,182,000
Est. 08 Completions 83 5,716,000
Planned 62 9,424,000

Planned Retail Construction Construction Highlights

Chicago is one of the fastest-growing cities in the
Midwest, and builders have responded to the metro’s
favorable conditions. After peaking at 10.7 million
square feet in 2007, retail deliveries will return to
levels more in line with the five-year historical
average, as developers are scheduled to complete 5.7
million square feet of space in 2008. Once finished,
2008 deliveries will increase metro inventory by less
than 2 percent. Builders have focused their efforts on
the Lake/McHenry and Far South submarkets, which
have a combined 11 projects totaling approximately
1.4 million square feet.
Nearly 50 percent of this year’s projects are larger
than 100,000 square feet. The Arboretum of South
Barrington, for example, is the biggest development
under way in the metro, located off Higgins and
Bartlett roads in Barrington. The project is slated to
add 600,000 square feet to local stock in the third
quarter of this year.
Looking ahead developers will shift their focus to
renovation and repositioning opportunities, as the
planning pipeline for new construction has declined
significantly, due in part to rising construction costs,
and scarcity of developable land remaining in the
metro.
Phillip Richardson 1 © Marcus & Millichap 2008
Research Associate, Research Services www.MarcusMillichap.com
Sources: Marcus & Millichap Research Services, Reis, TWR, US Census Bureau
The information contained herein was obtained from sources deemed reliable. Every effort was made to obtain complete and accurate information; however, no representation, warranty or guarantee to the accuracy, express or implied, is made.
 Chicago Retail Construction Report
Second Quarter 2008

Chicago Retail Submarket Map Chicago Submarkets

Arlington Heights
Far North
Far South
Far West
Far Northwest
Kane
Lake/McHenry
Lombard/Addison
Near West
North
South
Southwest

Construction Pipeline by Submarket

Projects Square Feet
Under Under Projects Planned
Submarket Construction Construction Planned Square Feet
Lake/McHenry 7 721,000 11 2,566,000
Far South 4 717,000 4 1,483,000
Far Northwest 2 616,000 2 72,000
Southwest 3 226,000 5 432,000
North 1 125,000 3 481,000
Far West 2 75,000 2 161,000
Far North 1 29,000 4 174,000
Kane - - 4 698,000
South - - 5 694,000
Near West - - 6 594,000
Arlington Heights - - 3 475,000
Nondefined Areas 10 1,441,000 13 1,595,000
Phillip Richardson 2 © Marcus & Millichap 2008
Research Associate, Research Services www.MarcusMillichap.com
Sources: Marcus & Millichap Research Services, Reis, TWR, US Census Bureau
The information contained herein was obtained from sources deemed reliable. Every effort was made to obtain complete and accurate information; however, no representation, warranty or guarantee to the accuracy, express or implied, is made.
 Chicago Retail Construction Report
Second Quarter 2008

Under Construction
Submarket Project Title Primary Address City Sq. Ft. (000s) Owner/Developer Name Target Completion
Far North Gross Point Crossing 5220 Dempster Street Skokie 29 Fog Capital 3Q 2008
Far Northwest The Arboretum of South Barrington Higgins & Bartlett roads South Barrington 600 The Jaffe Cos. 3Q 2008
Far Northwest ALDI Grocery Store 1412 E. Algonquin Road Schaumburg 16 ALDI Inc. 3Q 2008
Far South Marshfield Shopping Center 119th Street & Marshfield Avenue Chicago 440 Primestor Development 4Q 2008
Far South Target 1700 W. 119th Street Chicago 150 Target Stores 4Q 2008
Far South Wal-Mart/Sam's Club Torrence Avenue & Ring Road Calumet City 110 Wal-Mart Stores Inc. 3Q 2008
Far South ALDI Grocery Store Western Avenue & 122nd Street Blue Island 17 ALDI Inc. 3Q 2008
Far West Whole Foods Market 75th Street & S.R. 59 Naperville 60 Whole Foods Market 3Q 2008
Far West Walgreens Drugstore 680 E Boughton Road Bolingbrook 15 Praedium Development 3Q 2008
Lake/McHenry Lowe's Home Center 1660 Milwaukee Avenue Vernon Hills 170 Lowe's Cos. Inc. 2Q 2008
Lake/McHenry Wal-Mart Supercenter 21101 McGuire Road Harvard 154 Wal-Mart Stores Inc. 2Q 2008
Lake/McHenry Life-time Fitness 680 Woodlands Parkway Vernon Hills 141 Life-time Fitness Inc. 3Q 2008
Lake/McHenry Centegra Fitness Center Haligus & Algonquin roads Huntley 120 Centegra Health System 3Q 2008
Lake/McHenry JCPenney Harrish Drive & Randal Road Algonquin 100 JCPenney Co., Inc. 2Q 2008
Lake/McHenry Crate & Barrel 20530 N. Rand Road Deer Park 20 Crate & Barrel 2Q 2008
Lake/McHenry Crossroads of Crystal Lake Randall Road & McHenry Avenue Crystal Lake 17 The Shiner Group LLC 2Q 2008
North Menards 1500 N. Kostner Avenue Chicago 125 Gold Realty Group 4Q 2008
Southwest Wal-Mart Supercenter 9265 159th Street Orland Hills 196 Wal-Mart Stores Inc. 3Q 2008
Southwest Berkots Grocery Store 20005 Wolf Road Mokena 15 Berkots Super Foods 2Q 2008
Southwest Walgreens Drugstore Romeo Road & Mikan Lane Romeoville 15 GVA Williams 3Q 2008
Nondefined Areas Mokena Market Place Lincoln Highway & Wolf Road Mokena 400 V-Land Corp. 4Q 2008
Nondefined Areas Shops on Main 145 U.S. 41 Schererville 350 Boyer Construction Co. 4Q 2008
Nondefined Areas Target Store Bridge Street & Legion Road Yorkville 185 Target Stores 3Q 2008
Nondefined Areas MetraMarket 118 N. Canal Street Chicago 166 METRA/Northeast Illinois Railroad Corp. 2Q 2008
Nondefined Areas Target Store Highway 10 & 104th Avenue Kenosha 127 Target Stores 2Q 2008
Nondefined Areas Jewel Osco 370 N. Desplaines Street Chicago 74 SuperValu Inc. 3Q 2008
Nondefined Areas Dick's Sporting Goods S.R. 50 & 104th Street Pleasant Prairie 51 Gershman Brown & Associates 4Q 2008
Nondefined Areas LA Fitness U.S. 34 & Ogden Fall Boulevard Oswego 42 LA Fitness International LLC 4Q 2008
Nondefined Areas Best Buy 7000 120th Avenue Kenosha 30 GM Investors 3Q 2008
Nondefined Areas Crown Point Plaza 107th Avenue & Superior Drive Crown Point 16 Aetna Development Corp. 4Q 2008
Total Under Construction 3,950

Phillip Richardson 3 © Marcus & Millichap 2008

Research Associate, Research Services www.MarcusMillichap.com
Sources: Marcus & Millichap Research Services, BOC, Reis, TWR
The information contained herein was obtained from sources deemed reliable. Every effort was made to obtain complete and accurate information; however, no representation, warranty or guarantee to the accuracy, express or implied, is made.
 Chicago Retail Construction Report
Second Quarter 2008

Planned Construction
Submarket Project Title Primary Address City Sq. Ft. (000s) Owner/Developer Name Target Start
Arlington Heights International Shopping Center Arlington Heights & Golf roads Arlington Heights 417 Target Stores N/A
Arlington Heights McDonalds 100 W. Rand Road Arlington Heights 42 McDonald's Corp. N/A
Arlington Heights Retail Building Kensington & Wheeling roads Mount Prospect 16 Nepco Inc. N/A
Far North Whole Foods Market Willow & Waukegan roads Glenview 65 Whole Foods Market N/A
Far North Curragh Irish Pub 6701 Northwest Highway Chicago 42 Axis Development Group LLC N/A
Far North CVS Pharmacy 2648 Dempster Street Park Ridge 42 Gershman Brown & Associates N/A
Far North Fresh Farms International Market 2560 Pfingsten Road Northbrook 25 Svigos Northbrook LLC N/A
Far Northwest Ashley Home Furniture 400 Columbine Boulevard Hoffman Estates 57 McShane Construction Corp. N/A
Far Northwest Walgreens Drugstore 807 W. Northwest Highway Palatine 15 Walgreens Co. N/A
Far South Shopping Mall 182nd Place & Anthony Road Country Club Hills 1,042 The Prime Group Inc. N/A
Far South Pullman Quarters North Side of Chicago 400 Joseph T Ryerson & Son Inc. N/A
Far South Restaurant 274 River Oaks Drive Calumet City 21 Yum! Brand N/A
Far South Retail Building Lincoln Highway & Central Avenue Matteson 20 Gray Canyon Cos. Inc. N/A
Far West Von Maur S.R. 59 & 119th Street Plainfield 140 Von Maur N/A
Far West Restaurant 1212 S. Naper Boulevard Naperville 21 Yum! Brand N/A
Kane Aurora Venture Butterfield & Kirk roads Aurora 417 TMK Development Ltd N/A
Kane Costco 320 Randall Road St. Charles 154 Costco Wholesale Inc. N/A
Kane Life-time Fitness I-38 & Randall Road St. Charles 112 Lifetime Fitness Inc. N/A
Kane Walgreens Drugstore Route 47 & Park Avenue Sugar Grove 15 Walgreens Co. N/A
Lake/McHenry Volo Marketplace Routes 12 & 120 Volo 725 Mid America Real Estate N/A
Lake/McHenry Retail Development Routes 12 & 120 Lakemoor 700 Tucker Development Corp. N/A
Lake/McHenry Retail Development Route 83 & Aptakisic Road Long Grove 417 Mid America Development Partners LLC N/A
Lake/McHenry Huntley Grove Shopping Center S.R. 47 & Kruetzer Road Huntley 300 Par Development N/A
Lake/McHenry Menards S.R. 176 & S.R. 60 Mundelein 165 Rubloff Development N/A
Lake/McHenry Kohl's Route 173 & Brown Avenue Antioch 90 Kohl's Department Stores N/A
Lake/McHenry CVS Pharmacy East Main Street & Route 14 Cary 42 CVS Inc. N/A
Lake/McHenry Restaurants 5213 Northwest Highway Crystal Lake 42 Purinton Development, LLC N/A
Lake/McHenry LA Fitness 550 E. Rollins Road Round Lake Beach 40 LA Fitness International LLC N/A
Lake/McHenry Retail Development Route 83 & Rollins Road Round Lake 24 Ryan Cos. US Inc. N/A
Lake/McHenry Restaurant 205 S. Rand Road Lake Zurich 21 Yum! Brand N/A
Near West Bellwood Station 25th Avenue & Eisenhower Expressway Bellwood 450 Carroll Properties Inc. N/A
Near West Kroger Harlem Avenue & Cermak Road Berwyn 65 The Kroger Co. N/A
Near West Retail Building Lake & Forest avenues Oak Park 23 Sertus Development Partners N/A
Near West Restaurant 59 E. North Avenue Northlake 21 Yum! Brand N/A
Near West Best Buy I-290 & Mannheim Road Hillside 20 Par Development N/A
Near West Walgreens Drugstore Madison & Oak Park avenues Oak Park 15 Walgreens Co. N/A
North Retail Development 4400 Harlem Avenue Norridge 417 Bluebird Real Estate N/A
North Black Ensemble Theater 50 N. Clark Street Chicago 45 Black Ensemble Theater N/A
North Winnebago Court 170199 N. Winnebago Avenue Chicago 19 Smithfield Properties N/A
South Menards 7101 S. Cicero Avenue Chicago 417 Menards N/A

Phillip Richardson 4 © Marcus & Millichap 2008

Research Associate, Research Services www.MarcusMillichap.com
Sources: Marcus & Millichap Research Services, BOC, Reis, TWR
The information contained herein was obtained from sources deemed reliable. Every effort was made to obtain complete and accurate information; however, no representation, warranty or guarantee to the accuracy, express or implied, is made.
 Chicago Retail Construction Report
Second Quarter 2008

Planned Construction (continued)

Submarket Project Title Primary Address City Sq. Ft. (000s) Owner/Developer Name Target Start
South Lowe's Home Center 7971 S. Cicero Avenue Chicago 166 Lowe's Cos. Inc. N/A
South Trolley's Downtown Bar & Grille TBA Chicago 42 Trolley's Downtown Bar & Grille N/A
South Gordon Beirsch TBA Chicago 42 Gordon Beirsch Brewery N/A
South Claim Jumper Restaurant TBA Chicago 27 Claim Jumper Restaurants N/A
Southwest Target Store Weber & Airport roads Romeoville 180 Target Stores N/A
Southwest SuperTarget Store 159th Street & Farrell Avenue Lockport 125 TCB Design & Development N/A
Southwest Kohl's Airport & Weber roads Romeoville 87 Kohl's Department Stores N/A
Southwest Circuit City Weber & Airport roads Romeoville 20 Rubloff Development Group N/A
Southwest Retail Building 24 W. 191st Street Mokena 20 Arete 3 Ltd N/A
Nondefined Areas Sycamore Crossings DeKalb Avenue & Peace Road Sycamore 450 First Rockford Group Inc. N/A
Nondefined Areas Cedar Crossings U.S. 6 & Cedar Road New Lenox 400 Zaremba Group LLC N/A
Nondefined Areas Outlet Mall 28 120th Avenue Bristol 237 Tucker Development Corp. N/A
Nondefined Areas Menards Route 30 & S. Cooper Road New Lenox 140 McVickers Development N/A
Nondefined Areas JCPenney TBA Pleasant Prairie 100 JCPenney Co., Inc. N/A
Nondefined Areas Kohl's I-394 & Steger Road Crete 69 Reliance Capital management N/A
Nondefined Areas Grocery Store 104th Street & Green Bay Road Pleasant Prairie 60 Simon Property Group LTD N/A
Nondefined Areas Boston Blackies TBA Chicago 42 Boston Blackies Restaurants Inc. N/A
Nondefined Areas ALDI's Grocery Store Route 34 & Fifth Street Oswego 26 ALDI Inc. N/A
Nondefined Areas Restaurant 1601 W. Division Street Chicago 21 Yum! Brand N/A
Nondefined Areas Retail Building Weber & Boughton roads Bolingbrook 19 Home Run Inn Pizza N/A
Nondefined Areas ALDI's Grocery Store 101st & Wicker avenues St. John 16 ALDI Inc. N/A
Nondefined Areas Retail Building 104th Street & Green Bay Road Pleasant Prairie 15 Simon Property Group LTD N/A
Total Planned Construction 9,424 N/A: No Start Date Available

Phillip Richardson 5 © Marcus & Millichap 2008

Research Associate, Research Services www.MarcusMillichap.com
Sources: Marcus & Millichap Research Services, BOC, Reis, TWR
The information contained herein was obtained from sources deemed reliable. Every effort was made to obtain complete and accurate information; however, no representation, warranty or guarantee to the accuracy, express or implied, is made.