Week of January 3, 2000
  Snapshot from the Field

Pactiv Distribution Center
1999's Biggest Chicago-Area Build-to-Suit

Pactiv Corp.'s recently announced 871,200-sq.-ft. (78,408-sq.-m.) distribution center in Romeoville, Ill, - which company officials call "a key part" of the firm's heralded logistics system -- ranks as the Chicago area's largest industrial build-to-suit project for 1999.

The distribution center deal came soon after Pactiv (www.pactiv.com) was formally created by the spin-off of Tenneco Packaging from Tenneco. (The board of directors at Tenneco - which, with Pactiv's departure, has renamed itself Tenneco Automotive -- approved the spin-off.)

"As Tenneco Packaging, we have led the industry by providing innovative, value-added packaging solutions," Pactiv CEO Richard Wambold commented as the spin-off became official. "As an independent company, we look forward to being measured against the best competitors in the specialty packaging industry."

New Facility Adds to Logistics Strengths

The new facility in Romeoville adds another strong competitive weapon to already considerably arsenal amassed by Pactiv, which is headquartered in Lake Forest, Ill.

A leading "pure-play" specialty packaging company with approximately $3 billion in revenues, Pactiv gets particularly strong marks from analysts for its logistics systems, of which the new Romeoville facility will become a part.

In addition, the newly independent operation boasts strong market shares. Some 80 percent of Pactiv's annual revenues come from products in which the company has a leading market position. Pactiv, in fact, ranks No. 1 in almost every one of its key product lines, which include plastic waste bags (Hefty), plastic food-storage bags (Baggies) and aluminum bake-ware (E-Z Foil), disposable tableware, foam products and flexible packaging.

1.5 Miles from I-55

The new facility will be located on a 65-acre (26-ha.) site in Romeoville, a town of some 15,000 residents located 28 miles (45 km.) southwest of Chicago The Romeoville site sits roughly 1.5 miles (2.4 km.) from a four-way interchange of I-55 and Weber Road.

The one-story building, say company officials, will use state-of-the-art technology, including pre-cast panels, 30-foot (9.1-m.) clear heights and an ESFR sprinkler system.

Locating on the large, 65-acre Illinois site also gives Pactiv the flexibility to readily expand its operations to meet the growing demand that typifies many of the company's primary product lines. The facility at the Romeoville site can be expanded by almost 50 percent from the current design to a total floor space of 1.3 million sq. ft. (117,000 sq. m.), company officials say.

Pizzuti Handling Design/Build

Pactiv has selected The Pizzuti Cos. (www.pizzuti.com) -- which has offices in Chicago; Columbus, Ohio; and Orlando, Fla. - as the design/build firm for the new facility. Pactiv's prior experience in working with Pizzuti was a major factor in awarding the assignment for the design/build work on what will be Pactiv's 87th facility in 20 nations around the world, company officials say. "Pizzuti has provided us with excellent service, and it has been a pleasure working with them," said Shawn Kilpatrick, Pactiv director of facilities. "We are excited to begin development on this project in Romeoville, which will become a key part of Pactiv's logistics system."

The new Pactiv facility is expected to be completed and online by October of 2000.

Chicago Market Active

The big Pactiv deal marks only the latest real estate log thrown onto the fire of a very active Chicago-area industrial construction market. In 1998, according to Grubb & Ellis statistics, construction began on more than 8 million sq. ft. (720,000 sq. m.) of speculative industrial development in the Chicago metro area, while 1998 build-to-suit activity totaled another 4.5 million sq. ft. (405,000 sq. m.). Analysts project that 1999's industrial construction activity will approach or exceed 1998 levels.

Other major real estate projects undertaken in the Chicago area over the last few years have included:

  • Ashland Marketplace, a 557,000-sq.-ft. (50,130-sq.-m.) high-cube warehouse/distribution building, one of the largest speculative industrial developments in the Chicago area during 1999.
  • Online auction house TechSmart.com's 100,000-sq.-ft. (9,000-sq.-m.) office/warehouse facility in Bolingbrook, which is scheduled to come online in February 2000.
  • Two Catellus Development-built speculative industrial buildings totaling 524,000 sq. ft. (47,160 sq. m.) at Catellus Development's International Center in west suburban Woodridge.
  • KYB America's Tollway Park/Two, a 129,600-sq.-ft. (11,664 sq. m.) office, warehouse and light-assembly facility in west suburban Addison, developed by The Alter Group.
  • Heidenhain Corp.'s 109,000-sq.-ft. (9,810-sq.-m.) North American headquarters facility in northwest suburban Schaumburg, with MTI Construction Services serving as the project's design/build firm.



©2000 Conway Data, Inc. All rights reserved. Data is from many sources and is not warranted to be accurate or current.