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MARCH 2006

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ILLINOIS SPOTLIGHT


Still Jumpin' in Joliet

Andrew Corporation is selling off the last piece of its longstanding Orland Park complex (pictured) for residential development, and moving its operations to Will County.
   Has it already been 25 years since "Blues Brothers" Joliet Jake and Elwood hit the gas on their mission to bring the blues to the world? Today, it's the Chicago fringe communities of Joliet and Elwood that are on a business development mission, and they're not singing the blues.
   Connections are at the heart of the growth, fueled by logistics facilities. But other kinds of connections abound too: ExxonMobil's planned $100-million expansion at its refinery in Channahon is being accompanied by a new hydrogen facility from Pennsylvania-based Air Products, expected onstream in May 2006. It's one of five hydrogen plants currently on the boards for Air Products in North America, and while the company refrains from announcing capital investment figures, a similar plant it began building in 1998 was projected to cost $80 million.
   In an about-face from the normal consolidation trend, 69-year-old communications infrastructure equipment manufacturer Andrew Corp.
has decided to leave its Orland Park digs behind for two new facilities, a 45,000-sq.-ft. (4,181-sq.-m.) headquarters in west suburban Westchester and an 800-employee office and manufacturing facility on 47 acres (19 hectares) in Joliet's Cherry Hill Business Park. The park is a 1,200-acre (486-hectare) development on the south side of Interstate 80 near the new Interstate 355 extension, and only one mile (1.6 km.) from two four-way I-80 interchanges at Route 30 in New Lenox and Briggs Street in Joliet. Andrew Corp. has signed a 15-year lease with Northern Builders Inc., which will construct, own, and manage the 570,000-sq.-ft. (52,953-sq.-m.) facility, expected to be ready for occupancy in 2007.
   "Our new facility will be a world-class workplace and a showcase for operational excellence in manufacturing," said John DeSana, group president, Antenna and Cable Products, Andrew Corporation. The company had considered three different properties within a 10-mile (16-km.) radius of Orland Park.
   So why is Andrew bucking the consolidation trend and, like Wrigley, leaving a place it had inhabited for decades? For reasons all too familiar to corporate real estate directors: residential and commercial encroachment and the land price hikes that come with it.
   "The dramatic growth of the residential and retail areas around us has created a unique development opportunity within Orland Park and thus a high level of interest in our property," said Ralph Faison, president and CEO of Andrew Corp., in August 2005. "The value of this property enables us to fund the move to a new company headquarters and world-class manufacturing facility."
   That value was $28.5 million, the amount paid to Andrew Corp. by developer Kimball Homes for the 104-acre (42-hectare) Orland Park property. Andrew in 1947 acquired 430 acres in Orland Park for future development, opened its first small manufacturing site there in 1954 and moved its South Side Chicago headquarters there in 1960.
   Another value added to the deal was a State of Illinois incentive package that includes tax credits and training funds with total potential value of up to $8.3 million over 10 years, in return for choosing Illinois locations and meeting certain employment level commitments.
   Joliet and Elwood were by no means the only hot spots for project development on the Windy City's outskirts. Others seeing multiple investments include Aurora, Bolingbrook, Elgin (leading the pack), Gurnee, Itasca, Naperville, Romeoville, West Chicago and Woodridge — forming a virtual unbroken chain of corporate development encircling the metro.

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