MIDDLE MARKET HIGHLIGHT, OCTOBER 2007

Chicagoland Retail Explosion Follows I-94/Lake Michigan into Indiana

The expansion of the Chicago retail market continues unabated to the west, as shopping centers and retail hubs are created out of farm land in numerous outlying Illinois suburbs, but the retail sector’s eastward movement has picked up as well. Following Lake Michigan’s shoreline, as well as the heavy traffic in Interstate 94, retail developers are moving into northern Indiana in towns such as Michigan City and Valparaiso.

A collection of developers are working to deliver approximately 700 acres of retail development at the intersection of I-94 and US Route 421, Michigan City’s main retail corridor. The area already features Lowe’s Home Improvement Warehouse, Menards, Meijer and a new Wal-Mart Supercenter.

GK Development, a Barrington, Illinois-based developer, is bringing 250,000 square feet of in-line space and 50,000 square feet of outlots to the corridor, as well as a hotel with more than 100 guestrooms. GK is partnering with Porter County to facilitate infrastructure financing for utilities, and site preparation is underway. Construction on the 56-acre site is expected to begin early next year.

Valparaiso is another emerging retail market, with two significant projects underway. Lauth is developing Porter’s Vale, a 750,000-square-foot shopping center located at state roads 49 and 2. The 100-acre project will feature 100,000-square-foot JC Penney and a 12-screen Cinemark Theatre.

At the intersection of Calumet Avenue and Vale Park Road in Valparaiso, Urschel Development is building Cumberland Crossing, a 173,000-square-foot village retail center. The project is a ground-up redevelopment of an obsolete strip center. It will feature a state-of-the-art, 83,000-square-foot  Family YMCA fitness center, which will break ground this month; other targeted tenants include casual restaurants, banks, and recreation and family activity retailers. Completion of the first three buildings is expected late this year; the first stores could be open early 2008. Michael LaRue of LaRue Associates is handling the leasing of the project, which is designed in the prairie style, with clusters of buildings around seating areas, pedestrian paths and extensive landscaping.

— Kevin Jeselnik

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