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755 Church Rd.
Elgin, IL 60123

Elgin- 28,000 sq ft masonry industrial building on 2 acres. 14 ft ceiling, covered dock, 12x14 DID. Sprinklered. Close to Tollway. 10% down SBA financing.

Brokers: Bruce Kaplan & Kevin Kaplan
2510 US Rt. 12
Spring Grove, IL 60081

Spring Grove-8040 sq ft freestanding commercial building on busy Highway 12 on 28000 sf site zoned B-2. Ideal showroom/warehouse. Bank has reduced price and will finance.

Brokers: Kevin Kaplan & Bruce Kaplan
11715 Main St.
Huntley, IL 60142

2923 sq ft office or retail building on the Square in downtown Huntley. Currently built out as professional offices. New roof in 2014. Full basement. Public parking behind building.

Broker: Heather Schweitzer
919 La Fox St.
South Elgin, IL 60177

South Elgin-9600 sq ft multi-tenant 100% leased investment with 6312 sf retail and 2843 sf offices. Built 1977 on .94 acre. Call for rent roll and operating statement.

Broker: Sharon Glasshof
228 Florence St.
Crystal Lake, IL 60014

Crystal Lake- Fully leased for 4 more years. 2,384 sf 2 level plus full basement. Ask for rent roll and operating statement.

Broker: Mike Deacon
268 S. Randall Rd.
Algonquin, IL 60102

Algonquin- Randall Road retail space in front of Home Depot. Lots of natural light. 40,300 cars per day.

Broker: Brian Cowell
Sold And Leased
Featured Article
Subleasing Pitfalls and Strategies

As the pandemic continues to roil CRE markets and deals, there is one area that is seeing heightened activity: the availability of sublease space, particularly in the office sector, which has taken off at a record pace. As a direct results, the astute broker should consider some key subleasing issues and strategies. We identify several of these here with suggested ways to handle and use to your respective clients advantage.

Right to and Conditions of Sublease:
First and foremost, the tenant’s right to sublease must be expressed in the lease. Coupled with that, the conditions under which the sublease is allowed should be detailed, including: information needed by the landlord in advance of landlord’s decision whether or not to consent to the sublease (subtenant’s name, use, financials, and form of sublease, including sublease rent and terms). In some cases, the tenant/sub-landlord may have the right to share in excess rent charged the subtenant, or perhaps a share net of sublease expenses such as marketing expenses, tenant improvement costs, and commissions.

Tenant’s Payment of Rent/Creditworthiness and the Effect on Subtenant:
As the pandemic took hold and government shelter-in-place orders proliferated, tenants’ businesses faltered and many works – especially those who are office-based – started working from home, resulting in many tenants not paying some or all of their monthly rent, with or without rent deferral agreements in place. If a sublease is already in place, and the tenant/sub-landlord stops paying rent, that could trigger lease default provisions, adversely impacting the subtenant’s right of possession, among other negative consequences. In certain leases, a departure from occupying the space could impact co-tenancy provisions in other leases in a multi-tenant property. It might also activate landlord’s right of recapture, if one exists in the primary lease, and potentially terminate both the lease and the sublease. Also, if a tenant/sub-landlord defaults on the primary lease, will the subtenant be protected if it keeps paying rent on the sublease space? Does the subtenant have the right to directly pay the primary landlord so that the subtenant isn’t squeezed of its possession rights or other rights under the sublease? These rights – usually contained in the sublease – may allow a landlord to accept subtenant’s rents. In other words, the sublease should also be structured to protect the subtenant as well.

Tenant’s Obligations Regarding Premises:
A tenant may have existing obligations under the primary lease, such as restoration at the end of a lease term. If a subtenant is in possession of the premises under a legitimate sublease the primary lease ends, what happens if the tenant-sub-landlord – who already missed several months’ rent payments – also fails to restore the premises as set for and required in the primary lease? It is incumbent upon the subtenant, his broker, and the attorney, to parse out all primary lease obligations that arguably may fall into the subtenant’s lap at some future date.

The Sublease As a Benefit To Tenant:
Given potential pandemic-induced tenant challenges, financial or otherwise, from a strategy standpoint, consider whether a sublease might enhance a tenant’s position vis-à-vis the landlord. If the landlord is concerned about a tenant’s financial viability, a sublease could put the tenant in a better position, with an able subtenant to cover for any tenant-sub-landlord missteps. However, to bring the concept full circle, one could argue that the subtenant must agree to attorn to the landlord in order to enhance the tenant’s position.

These and many more issues make the sublease a challenging but potentially strategic tool for subtenants, tenants, and landlords and their experienced and knowledgeable SIOR advisors both in normal times and during our current pandemic as well.

Jim Hochman & David Liebman, JD, SIOR
Bruce Bossow x 12 / C: 847-732-3462
Bruce Kaplan x 20 / C: 847-507-1759
Heather Schweitzer x 15 / C: 815-236-9816
Heide Casciaro x 26 / C: 847-774-5660
Joe Billitteri x 21 / C: 847-833-5004
Kevin Kaplan x 13 / C: 309-261-0920
Sharon Glasshof x 14 / C: 847-533-6974
Brian Cowell x 18 / C: 815-529-7890
Mike Deacon x 28 / C: 815-814-6500

 9225 S. IL Route 31
Lake in the Hills, IL 60156