Suburban real estate market strong despite uncertainty
Despite the uncertain economy and headlines of companies leaving the suburbs for downtown Chicago, the suburban commercial real estate market remains healthy, industry experts told local business leaders Thursday at the Daily Herald Business Ledger Newsmakers' Forum on Construction and Real Estate.
About 90 suburban leaders attended the event at the Hilton Lisle/Naperville.
Art Rendak, president of Inland Mortgage Capital Corp. based in Oakbrook Terrace, said the suburban real estate market continues to go strong despite uncertainty in the economy. "The economy should be doing better than it is, obviously," Rendak said, noting that low oil prices, mortgage rates and unemployment figures should be translating into a more robust economy.
However, he said suburban real estate, especially industrial and office properties, has been strong as companies grow and relocate to larger facilities. He noted the distribution industry has particularly risen as new facilities are being built locally to handle the growing demand.
"You just can drive from Wilmington, up (Interstate) 55 to Bolingbrook to see the tremendous growth of industrial," Rendak said. "Especially if you're outside Cook County, where the taxes are cheaper, you're going to continue to see a lot of growth in the distribution sector."
Bryan Gay, economic development director of Choose DuPage, noted DuPage County's surge in growth in the number of businesses over the years. In 2015, he said, 900 new small businesses opened in the county.
"These small businesses are the lifeblood of DuPage County," Gay said, "Since 2010, we've seen over 3,000 new businesses in DuPage County."
He noted the small businesses are just as important as large companies, as they generate local jobs and invest in the communities they are in. He added that, of the 60,000 new jobs created in DuPage County since 2010, small businesses accounted for 60 percent of that growth.
All of the panelists spoke of the educated workforce that is a main draw to the suburbs for businesses, and Daniel Allen, executive director of the Construction Industry Service Corporation (CISCO), added that the region also benefits from the educated construction workforce as well.
"Union contractors have the highest educated skilled workforce in the world," Allen said, pointing to education apprentice programs that are funded through union contractors and employees and are created through collective bargaining agreements.
Allen was critical of Gov. Bruce Rauner's right to work initiative, which he said would undermine the funding of the apprenticeship programs and lead to construction deficiencies created by unskilled workers.
"On the outside work may look good, but the lack and training and skills create ticking time bombs of public safety issues," Allen said. "Most of the problems develop over the years after construction.
"The term 'right to work for less' is a misnomer," he added. "It's a policy that prohibits a union from negotiating security clauses with these small businesses."
Presenting sponsors of the Newsmakers Forum are The Inland Real Estate Group of Companies and CISCO. Marketing partners are GOA Regional Business Association, The Management Association, MRA-The Management Association, Small Business Advisory Council and the chambers of commerce of Greater Oak Brook, Lisle and Naperville.