After filling a former Buy Buy Baby store with a Sky Zone trampoline park, the owner of a shopping center on Chicago’s North Side is ready to test how much the property’s value has rebounded.
Los Angeles-based Westwood Financial has hired Greenstone Partners brokers to find a buyer of the Kingsbury Center along the Old Town and Lincoln Park neighborhoods, the Chicago brokerage said.
The nearly 54,000-square-foot shopping center at 1415-1435 N. Kingsbury St. is fully leased to Sky Zone and PetSmart, according to a property brochure.
It is being marketed as a low-risk investment in the short term, with a weighted average lease term of 6.8 years. It also is pitched as a long-term opportunity to explore a higher-density redevelopment of the 2.33-acre site, as zoning of the once-industrial corridor has shifted to allow big apartment towers in recent years.
That would require a zoning change from the city, but there has been a move toward more high-rise residential projects in the Clybourn Corridor shopping district in recent years.
“It’s a rare opportunity to buy a stabilized retail property of this size in the area,” Greenstone broker Danny Spitz told CoStar News. “It’s also a covered land play. There’s a lot of flexibility to do something bigger on the site down the road, in a pocket where zoning has been relaxed to allow more residential development.”
The offering price is $21.89 million, according to the brochure.
That is less than the $27.7 million that Westwood paid in a 2017 deal that included a loan assumption, according to Cook County property records. But it is far above the value of the property after Buy Buy Baby closed its store there in early 2023, just before parent company Bed Bath & Beyond filed for bankruptcy protection.
Westwood did not immediately respond to a request for comment from CoStar News on Tuesday.
As part of an ongoing national expansion initiative, Utah-based Sky Zone in 2023 swooped in to lease the more than 35,000-square-foot former Buy Buy Baby space. The store opened last year within the center that has 86 surface parking spaces.
PetSmart and Sky Zone each have several lease extension options with 10% rent escalations, according to the brochure.
If the retail tenants were to leave years from now, the property owner could look to replace the single-story retail property with a residential high-rise.
Similar projects have played out nearby, including the 327-unit Foundry tower at 1475 N. Kingsbury and a planned 272-unit tower at 1333 N. Kingsbury.
The longtime Carbit Paint property at 1440 N. Kingsbury is on the market for sale as a potential high-rise site, pending a zoning change. Several other major residential projects are being drawn up within a few blocks.
Nearby retailers include an REI store with river access, an Off Color Brewing taproom and large Whole Foods and Apple stores.
For the record
The seller is represented by Greenstone's Spitz and Arjav Patel.