Outstanding Redevelopment or Reuse Opportunity - Short-Term Leaseback - United Airlines Headquarters
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United Airlines Headquarters
SUBURBAN CHICAGO
66 ACRES
Outstanding Redevelopment
or Reuse Opportunity
Short-Term Leaseback
Offered Exclusively by
offering
Jones Lang LaSalle is pleased to present
for sale the former world headquarters of
United Airlines. The Property, located at 1200
East Algonquin Road in northwest suburban
Chicago, consists of approximately 66 acres of
land and is currently improved with over one
million square feet of office and data center
space. It’s large size and prominent location
near O’Hare International Airport represents
an exceptional infill redevelopment opportunity
with immediate cash flow in the form of a short-
term leaseback from United Airlines.
2 www.joneslanglasalle.com
property location
55 94
90
Located in unincorporated Cook County, Illinois, the Prop- to enhance the I-90 and Elmhurst Road intersection south
erty is approximately 22 miles northwest of downtown of the property to a full four way interchange, substantially
Chicago near Mount Prospect and Elk Grove Village. improving eastbound interstate access to the area. Addi-
It offers direct access to downtown and the surrounding tionally, O’Hare International Airport is located just four
suburbs via the Northwest Tollway (I-90) with two in- miles southeast of Property. O’Hare is the second busiest
terchanges located less than two miles from the site. The passenger airport in the world and the second busiest cargo
Illinois Department of Transportation (IDOT) is planning airport in the United States.
3
property description
Situated on 66 acres of land, the Property is currently im- Utilities to the site are abundant. The campus is served by
proved with four office/training buildings ranging from two two separate ComEd substations for electricity, AT&T for
to eight stories, an underground data center, several surface their data service (Level 3, adjacent to the Property, is also
parking lots and amenities such as a large pond with walking a provider), Illinois American Water, Cook County sewer,
trails, tennis courts, a recently updated cafeteria and a pool. Nicor gas and Elk Grove Township fire protection.
The existing buildings have floor-to-ceiling windows and The Property enjoys excellent access and visibility along
several interior atriums allowing natural light to penetrate heavily trafficked thoroughfares, with over 2,300 feet of
the space. The wide column spacing is ideal for a variety frontage on Algonquin Road and Dempster Road and 1,800
of build-outs including office, training and classroom uses. feet of frontage on Linneman Road. Access to the Property is
The Property includes a 110,000 square foot fully functional available at multiple points from all three thoroughfares, in-
underground data center that is currently in use as United’s cluding signalized intersections at Algonquin and Dempster
primary data center. It includes more than 25,000 sqare feet on Linneman. This incredible access and visibility, combined
of raised floor, redundant power from two separate ComEd with the large size of the Property, create a unique infill rede-
substations and back up power from multiple generators. velopment opportunity with immediate cash flow to support
Additionally, the site is located within two blocks of the the Property through the planning and entitlement process.
ComEd substation at the corner of Algonquin and Busse. The excellent location and large size of the Property afford
According to ComEd, this is the highest capacity substation a wide variety of redevelopment scenarios. Recent archi-
in the Chicago area on their grid. tectural studies commissioned by United Airlines show
Surrounding uses include residential to the north, industrial that the Property can support up to 894,000 square feet of
to the south and east, and retail/office/medical to the industrial development. Alternatively, the Property can be
west, including Northwest Community Hospital. With the developed into a mixed-use business park supporting up to
exception of residential, which is not favored by Elk Grove 450,000 square feet of office and light industrial space with
Township, any one of these uses is feasible given the current several retail outlots, all set in a park-like environment by
building layout and estimated 3,000 parking spaces. maintaining the current pond and walking trails.
BUILDING GROSS ABOVE-GRADE BELOW-GRADE PERCENTAGE YEAR(S)
BLDG AREA BLDG AREA BLDG AREA BELOW GRADE CONSTRUCTED
North* 248,392 SF 193,120 SF 55,272 SF 22% 1967, 1980
Underground Data Center 110,000 SF — 100,000 SF 100% 1987
South 505,353 SF 315,648 SF 189,705 SF 38% 1961
Training Center
8-Story Portion 128,572 SF 110,832 SF 17,740 SF 14% 1966
2-Story Portion 85,228 SF 72,336 SF 12,892 SF 15% 1961
TOTALS: 1,077,545 SF 691,936 SF 375,609 SF
*includes 50,000 square foot operations control center
4 www.joneslanglasalle.comdevelopment opportunity
PARCEL SIZE (Acres) MUNICIPALITY ZONING ALLOWED DEVELOPMENT
Unincorporated R-7 General Medium density residential
1 5
Cook County Residence District
Unincorporated C-7 Office/Research Large office and
2 56
Cook County Park District light industrial buildings
Village of R-4 Multi-Family Medium- to high-density
3 5
Mt. Prospect Residence District multifamily residential
TOTAL: 66 ACRES
5real estate market
STRATEGIC LOCATION
The Property is located in northwest suburban Chicago, a INCENTIVES
thriving hub of office and industrial activity driven largely The Property may be eligible to receive a Class 6b
by the proximity to O’Hare International Airport. The classification to reduce real estate taxes for new industrial
O’Hare office market is one of the largest and most active development. It may also be possible to establish a Tax
suburban markets surrounding Chicago. It accounts for over Increment Financing (TIF) district for the Property to
14% of the total suburban office inventory in the Chicago encourage office or retail redevelopment.
Metropolitan Area. The industrial market surrounding the
Property also benefits from its proximity to O’Hare, which DEMOGRAPHICS
is the second busiest cargo airport by value in the United The surrounding area is a stable, upper-middle class
States. As a result of O’Hare’s strategic location in the community with median household income well above
continental U.S. more than 1.7 million tons of cargo passes that of the City of Chicago and Cook County. Within
through this major hub each year. a five-mile radius of the Property, 68% of the housing
Chicago is the nation’s busiest rail hub and the largest units are owner occupied and 70% of the population is
intermodal container handler in the Western Hemisphere. employed in white collar jobs.
Twenty-nine percent of North American industry is located
within one-day truck delivery and forty-two percent of North
American consumers are located within two-day truck deliv-
ery. The Property’s easy access to the Northwest (I-90) and DEMOGRAPHICS
Tri-State (I-294) Tollways and the Dwight D. Eisenhower
Expressway (I-290) offer linkages to downtown Chicago, 1-MILE 3-MILE 5-MILE
the surrounding suburbs and the entire Midwestern U.S. Population
20,915 99,454 241,551
The O’Hare retail market consists of approximately nine
million square feet of space with a vacancy rate of only Households
6.7%, compared to 9.0% for the total Chicago retail market. 7,969 38,597 94,662
Algonquin Road is a major thoroughfare running parallel to
Median Household Income
the Northwest Tollway through the northwestern suburbs.
There is a significant amount of retail development along $60,100 $69,850 $70,600
Algonquin starting at the western boundary of the Prop- Spending Power
erty and stretching several miles to the west. Additionally, $186,200,00 $1,058,600,000 $2,675,400,000
Elmhurst Road, located just east of the Property, is a major
north-south retail thoroughfare that runs from the western Source: Site to Do Business, U.S. Census Bureau
boundary of O’Hare to the north through the Village of
Mount Prospect.
6 www.joneslanglasalle.comsale leaseback
SALE-LEASEBACK INFO
During it's transition to new facilities, United Airlines will
need to lease back the facility for three years with a one-
year renewal option. While United is willing to take on tax
and operating expenses for the majority of the campus, they
will only occupy and leaseback the underground data center
and north building. Approximately 12 acres of land on the
western edge of the site is available for immediate develop-
ment. The chart below details the proposed cash flows from
the leaseback. This is a unique opportunity for a buyer to
plan the redevelopment of the site and obtain entitlements
while receiving income on the property for the next three
years. The immediate positive cash flow and the long-term
redevelopment potential give the buyer maximum flexibility
to benefit from market recovery over the next several years.
ASSUMPTIONS
Square Feet
Total Gross . ........................................... 1,077,545 SF
Underground Data Center . ....................... 110,000 SF
North Building .......................................... 248,392 SF
South Building/Training ........................... 719,153 SF
Rental Rate (NNN)
Underground Data Center . ........................... $10 PSF
North Building ................................................. $5 PSF
South Building/Training ................................. $0 PSF
CASH FLOWS
RENT Year 1 Year 2 Year 3 Total
Underground Data Center $1.1M $1.1M $1.1M $3.3M
North Building $1.25M $1.25M $1.25M $3.75M
South Building/Training * $0 $0 $0 $0
TOTALS: $2.35M $2.35M $2.35M $7.05M
* United Air Lines will pay taxes and operating expenses only on the South Building and Training Center.
United reserves the right to use this space in the future at no additional cost.
7contact info
For more information on this opportunity, please contact:
Jim Postweiler David Matthews John Roberson
jim.postweiler@am.jll.com david.matthews@am.jll.com john.roberson@am.jll.com
+1 312 228 2 6 61 +1 312 228 3 0 5 6 +1 312 228 24 81
Dan Mcgillicuddy Patrick Rippe
dan.mcgillicuddy@am.jll.com patrick.rippe@am.jll.com
+1 312 228 3 9 3 5 +1 312 228 20 6 6
Jones Lang LaSalle Americas, Inc.
200 East Randolph Drive | Chicago, Illinois 60601
Disclaimer. This document was prepared only for the purpose of providing information about the subject Property and should not be construed as a binding offer to
sell the Property. This document, the Offering Brochure, and the sale offering may be amended or withdrawn at any time without notice. Although information has been
obtained from sources deemed reliable, neither the Property owner, nor Jones Lang LaSalle, and/or its representatives, brokers, or agents make any guarantees as to the
accuracy of the information contained herein, and offer the Property without expressed or implied warranties of any kind.
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