In Korea, the most desirable office space is on the lower floors of buildings because of unreliable elevator service.
This small but possibly key fact could be important for those doing business in today’s “global village.” To succeed in overseas markets, U.S. firms need to be knowledgeable about foreign customs, terminolgy and regulations.
As an aid in charting these unknown waters, Colliers International created the “Survey of International Real Estate Practices,” a survival kit that reveals the practices and perils of commerce in 31 countries. Among the findings:
– Landlords in the Czech Republic offer adequate telephone service and parking as tenant inducements to lease space. Normally, the wait for telephone installation is four years.
– Free rent for up to one year can be negotiated in New Zealand.
– Until last February, there was no such thing as an office lease in Argentina.
– Businesses leasing in Bombay must pay key money ranging from two years’ rent up to 50 percent of the capital value of the property, plus the full rent for the initial term of the lease in advance.
– At least three different office space measurement methods are used in Hong Kong.
– In Russia, up to two years’ rent in advance often is demanded. In Moscow and St. Petersburg, there is a great demand for the limited supply of furnished space from 500 to 2,000 square feet.
– Typical lease terms in Ireland run from 15 to 25 years.
“Leases negotiated in foreign languages, enormous unsecured rent deposits, inadequate telephone and fax lines, space shortages and locations where leasing space is itself a foreign concept, are among the hurdles of conducting business in global markets,” said Stewart Forbes, president of Colliers International.
“While rent is quoted in local currency in most markets worldwide, Russia, Mexico, Indonesia, Turkey and China often favor the dollar, especially for foreign tenants,” Forbes said.
The Colliers report showed that while monthly rent payments are common in most countries, there are some exeptions.
Quarterly payments are used in the Czech Republic, France, Ireland, Italy and the United Kingdom. In Turkey, rent on commercial leases is paid three, six or 12 months ahead.
Even the definition of rent varies.
In France, for example, tenants pay loyer, which doesn’t include operating costs, maintenance, insurance and taxes.
For a copy of the 1995 Colliers Survey of International Real Estate Practices, contact Colliers, Bennett & Kahnweiler, the Chicago representative of Colliers International, at 708-671-7911.
New Winnetka bank
Ground has been broken for the new 18,000-square-foot Northern Trust Bank in Winnetka. The $5 million, two-story project will be just south of the bank’s existing structure at 62 Green Bay Rd. It will more than triple the size of the office.
The traditional styling was designed by Deerfield-based O’Donnell, Wicklund, Pignozzi & Petersen Architects Inc.
The gabled roof will be clad in slate, while arched windows and limestone accents will highlight the terra-cotta brick facade.
Bulley & Andrews of Chicago is the general constractor. Completion is expected next spring.
New South Side bank
Lakeside Bank has moved its Near South Side branch into new quarters at Cermak Road and Indiana Avenue after being located for almost 30 years at 23rd Street and King Drive.
The new building was needed after the old branch was condemned as part of the McCormick Place expansion. Hunter Alliance Corp. was the general contractor for the 6,000-square-foot, one-story facility.
Sealed bid sale
Nineteen commercial real estate properties in the Chicago area will be offered in a sealed bid sale by Signature Realty Group. The bid deadline is Aug. 31, according to Ross Waxman, president of Northbrook-based Signature Realty.
The sale portfolio includes four strip centers, a mixed-use retail and residential property in Skokie, a south suburban bowling alley that could be converted to retail use, two city retail opportunities, four industrial properties and two development sites.
Included in the sale is the Harvest Plaza shopping center at the southwest corner of Wise Road and Wright Boulevard in Schaumburg. The 29,000-square-foot center on a 3.5-acre site is 83 percent occupied.
For more information, call 708-272-4227.
Waukegan groundbreaking
Ground has been broken for a 22,000-square-foot manufacturing and office building for the Stiles-Kem Division of Met-Pro Corp. at AMLI Realty’s Amhurst Lake Business Park in Waukegan. Pickus Construction, a unit of the Pickus Companies, is providing design/build services.
Completion is expected in December.
The new facility will consolidate two previously owned plants in Zion and increase capacity for the production of non-toxic water treatment chemicals.
Shopping center rehab
Krusinski Construction Co. has completed a $500,000 rehabilitation project at the Waterfall Plaza shopping center, 8752 W. 159th St., Orland Park. M & J Wilkow Ltd. is the owner/manager of the 22,000-square-foot retail facility on a 2.6-acre lot. It includes 10 stores.
Krusinski also remodeled Premo’s II, a 50s-style restaurant at the center.
Sales and leases
– The 23-story, 357,736-square-foot 200 S. Michigan Ave. building has been sold by the Equitable Life Assurance Society of the United States to BGK Realty of Santa Fe, N.M., a private investment firm. The asking price was $16.5 million.
CB Commercial Real Estate Group represented Equitable. Since its opening in 1957, the structure has served as the headquarters of Borg Warner Corp., which occupies 91,000 square feet. Currently 85 percent leased, it has 26 other tenants, including corporate and legal firms.
Known as the Borg Warner Building, it has frontage on Michigan Avenue and Adams Street and overlooks Grant Park. “The listing drew multiple offers from prospective investors nationwide,” said Tony Smaniotto, who along with Cal Wessman marketed the property for CB Commercial.
– Illinois Wholesale Cash Register has purchased the 50,000-square-foot free-standing warehouse at 2495 Pembroke, Hoffman Estates, from Mupac Corp. Located on a 2.1-acre site, the structure includes 5,000 square feet of office space. Grubb & Ellis represented both parties in the transaction.
– Form Plastics Inc. has purchased the 119,770-square-foot distribution facility at 3825 Stern Ave., St. Charles, from Houghton Mifflin Co. The asking price was $4.25 million.
It was built in 1987 on a 9.59-acre site by McDougal Littel, which was acquired by Houghton Mifflin in 1994.
The building is located in the St. Charles Business Park, just west of Du Page Airport. The property includes 12,880 square feet of office space.
Cushman & Wakefield represented the seller, while the buyer was represented by Nicolson, Porter & List Inc. of Park Ridge.
– Garrett Realty & Development Inc. has announced the purchase of the 24,000-square-foot site at 2633-2645 N. Halsted St., Chicago, by RN Realty Ventures Inc., which plans to develop the property for Strouds Inc., a West Coast-based linens retailer. Regent Realty Group and Realvest Inc. represented the seller, Midland Mutual Life Insurance Co.
– The 700 Limited Liability Corp. of Oak Brook has purchased the 43,900-square-foot office building at 700 E. Ogden Ave., Westmont. The two-story structure built in 1975 currently is 75 percent leased. The new owner plans a major renovation next year.
CB Commercial Real Estate Group represented the buyer. The seller-a bank trust that earlier this year acquired the property-was represented by McCollom Realty Ltd. of Oak Park. The asking price was $1.9 million.
– Business Office Systems has purchased the 40,640-square-foot building at 740 Hilltop in Itasca. The five-year-old building has 8,000 square feet of office space and parking for 70 cars. The asking price was $2.25 million. Darwin Realty & Development Corp. represented both the seller and the buyer.
– The 35,000-square-foot Oak Lawn Plaza, 4944 W. 95th St., Oak Lawn, has been acquired by a local investment group. The broker in the transaction, valued at $2.5 million, was Benj. E. Sherman & Sons.
The property was sold on behalf of a Midwest bank, which acquired it through foreclosure. The retail facility is occupied by Chicago Title & Trust and Oak Lawn Furriers.
– Oracle Corp., a California-based software developer, has expanded its office space at the 203 North LaSalle Building in Chicago by 22,033 square feet. Goldie B. Wolfe & Co. represented the tenant.
– Carry Companies Inc. of Bridgeview, a trucking distribution firm, has leased the entire 128,685-square-foot building at 6700 S. Old Harlem Rd., Bedford Park, for a warehouse facility. Carry Companies was represented by Darwin Realty, while the owner, Heitman Properties Ltd., was assisted by Colliers, Bennett & Kahnweiler.
– Nifast Corp., a wholesale manufacturer and distributor of fasteners, leased 51,190 square feet from TA Associates Realty at 701 Regency Dr., Glendale Heights. This 98,000-sqaure-foot, two-tenant, office/industrial building is in the High Grove Center of Du Page-East Campus. TA Associates was represented by Grubb & Ellis, and Nifast by CB Commercial.
