Kemper Lakes Business Center sells for $190M, highest price for suburban office site in 17 years

  • The Kemper Lakes Business Center, north of Route 22 and east of Quentin Road near Kildeer, has been sold for $190 million, sources say.

      The Kemper Lakes Business Center, north of Route 22 and east of Quentin Road near Kildeer, has been sold for $190 million, sources say. Brian Hill | Staff Photographer

  • Kemper Lakes Business Center shares a ZIP code with Kildeer, Lake Zurich, Deer Park and Long Grove. It was sold last week for $190 million, the largest price paid for a suburban office property in 17 years.

      Kemper Lakes Business Center shares a ZIP code with Kildeer, Lake Zurich, Deer Park and Long Grove. It was sold last week for $190 million, the largest price paid for a suburban office property in 17 years. Brian Hill | Staff Photographer

 
 
Updated 5/18/2022 9:54 PM

The Kemper Lakes Business Center in southern Lake County has been acquired for $190 million, the highest price paid for a suburban office property in 17 years.

Northeast Capital Group of Spring Valley, New York, bought the nearly 1.1 million-square-foot center last week from New York-based Apollo Global Management, according to a source familiar with the transaction.

 

Apollo declined to comment and Northeast Capital could not be reached.

The center is surrounded by the Kemper Lakes Golf Club north of Route 22 and east of Quentin Road in unincorporated Lake County. The 164-acre property shares the 60047 ZIP code with Lake Zurich, Kildeer, Deer Park and Long Grove.

The Kemper sale, joining that of the Corporate 500 office complex in Deerfield six months ago, reflects a demand by investors who see a positive return in owning buildings with blue-chip tenants on long-term leases, according to Kevin Considine, president and CEO of Lake County Partners, the county's economic development arm.

Fresenius Kabi, ACCO Brands and Dovenmuehle are headquartered at the Kemper Lakes Business Center. Fresenius Kabi, a global health care company, is based in Germany, but its U.S. headquarters is at Kemper.

"It's a change in ownership due to the long-term leases in place," said Edie Marie Koehler, who is in her eighth year as senior general manager for Kemper Lakes Business Center and now works for Northeast Capital.

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"The acquisition for them is more of a long-term hold," she said.

Crain's Chicago Business reported the purchase price is the highest for a suburban office property since 2005, when the 150-acre former AT&T campus in Hoffman Estates was sold for more than $338 million.

Apollo paid $127 million for the campus in 2014, according to Crain's.

The Kemper Lakes sale stands out as a big bet on the office market. Remote work has increased and the pandemic pushed many companies to consider their workspace needs, according to Crain's.

"Investments like this aren't just about the buildings; they're also about the communities and their ability to attract talent," Considine said.

Lake County is home to 10 Fortune 500 companies, the second-largest concentration of corporate headquarters in the Midwest besides downtown Chicago, he said.

                                                                                                                                                                                                                       
 

Kemper Lakes Business Center consists of four connected buildings constructed from 1971 to 1991, Koehler said. It originally was developed and fully occupied by Kemper Insurance Group.

The pre-COVID population was 4,500 workers. It now stands at 1,300 and is improving, though it may not again reach full capacity, Koehler said.

Considine said every company nationwide is trying to determine the best way to integrate work-from-home flexibility.

"Realistically, it will take years to assess," he said.

Koehler described Kemper Lakes Business Center as a "corporate oasis" in a serene setting with amenities like day care and fitness centers and auditoriums.

Kemper was named the 2022 Regional Outstanding Building of the Year by the Building Owners and Managers Association of Suburban Chicago in the over 1 million square feet category and will proceed to the international competition, she said.

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