Dermody's O'Hare Logistics Campus: A Growth Engine for Midwest Industrial Real Estate

The industrial real estate sector is at a pivotal moment. E-commerce’s relentless rise, supply chain digitization, and corporate demand for sustainability are reshaping where—and how—businesses operate. Nowhere is this clearer than in the Chicago metro area, where Dermody Properties’ Logistics Campus in Glenview, Illinois, stands as a blueprint for future-proofed, high-performance logistics infrastructure. With its build-to-suit lease with Pepsi Beverages Company—a 351,520-square-foot anchor—and a strategic location near O’Hare International Airport, Dermody’s development exemplifies the trifecta of prime real estate positioning, ESG-driven design, and anchor tenant stability that will drive outsized returns in constrained industrial markets.

Location as Competitive Advantage: O’Hare’s Logistics Hub

The Logistics Campus sits at the intersection of I-294 and Willow Road, less than 10 miles from O’Hare—the world’s second-busiest cargo airport—and within Chicago’s North Suburban O’Hare industrial submarket. This location is no accident:
- Access to Talent: A 10-mile radius houses over 774,000 workers, critical for 24/7 operations and e-commerce fulfillment.
- Transportation Density: Direct highway access to I-94 and I-294, plus proximity to O’Hare’s global air freight networks, creates a logistics “sweet spot” for companies like Pepsi, which require rapid distribution to the Midwest’s 53 million consumers.
- Scarcity Premium: Chicago’s industrial vacancy rate hovers at 2.9%, among the lowest in the U.S. Dermody’s 3.2-million-square-foot master plan—phased to capitalize on constrained supply—positions it to command premium rents as demand outstrips new construction.

Industrial REITs like Prologis have outperformed the S&P 500 by 140% since 2020, underscoring investor confidence in logistics real estate. Dermody’s Glenview Campus is the local equivalent of such blue-chip assets.

ESG as a Competitive Weapon: Future-Proofing Infrastructure

Dermody’s focus on sustainability isn’t just a “check-the-box” exercise—it’s a strategic differentiator in a world where ESG criteria dictate corporate real estate decisions. The Logistics Campus has achieved LEED Silver Certification, with features that reduce operational costs and attract mission-aligned tenants:
- Energy Efficiency: Replaced 1960s-era structures with modern facilities built to today’s energy standards, slashing long-term utility bills.
- Circular Economy Integration: Recycled 11,000 tons of construction materials on-site, preserving 50 years of mature landscaping and trees.
- Renewable Readiness: Solar-ready roofs and EV charging stations allow tenants to adopt clean energy without upfront capital costs.

These elements aren’t just environmentally sound—they’re economically advantageous. A 2023 CBRE report found that green-certified industrial properties command 5–8% higher rental premiums and see faster lease-up rates. For Pepsi, a company under pressure to cut Scope 3 emissions, Dermody’s ESG framework is a non-negotiable requirement.

Anchor Tenant Stability: Pepsi’s 7-Year Lease with Upside

The Pepsi lease—a 7-year initial term with two 5-year extension options—is a gold-standard credit tenant for Dermody. The beverage giant’s commitment signals confidence in the campus’s operational advantages:
- Flexibility for Growth: The 351,520-square-foot facility’s 32’–40’ clear heights and Class A finishes support advanced logistics automation, critical for e-commerce fulfillment.
- Long-Term Cash Flow: With base rent set at a premium and extension clauses extending potential occupancy to 2037, this lease de-risks Dermody’s cash flow for over a decade.

Crucially, Pepsi’s decision to partner with Dermody reflects a broader industry trend: 58% of Fortune 500 companies now prioritize logistics real estate proximity to urban centers to reduce delivery times. Dermody’s Glenview Campus is perfectly positioned to serve this demand.

Scalability Meets Scarcity: A 4.9M SF Pipeline in High-Growth Markets

The Logistics Campus isn’t a standalone project—it’s the flagship of Dermody’s $10B Midwest industrial portfolio, spanning 15 states and 8.9 million square feet of available space. With 4.9 million SF under development and a focus on “last-mile” locations near major metros like Atlanta and Chicago, Dermody is capitalizing on a structural imbalance:
- Supply Constraints: The Midwest’s industrial vacancy rate is half the national average, with developers struggling to keep pace with e-commerce demand.
- Tenant Diversification: The Glenview Campus’s Phase 1 has already attracted advanced manufacturers, pharmaceuticals, and food producers—creating a tenant base resilient to sector-specific downturns.

Why Act Now?

Dermody’s strategy is a masterclass in industrial real estate investing:
1. Prime Location: O’Hare’s logistics density ensures long-term relevance.
2. ESG-Driven Value: Green features reduce tenant churn and attract premium rents.
3. Anchor Tenants with Extension Rights: Pepsi’s lease is a cash flow anchor with upside.
4. Scalable Pipeline: Dermody’s Midwest portfolio offers growth in a supply-constrained environment.

The writing is on the wall: industrial real estate scarcity is here to stay, and Dermody’s Glenview Campus is a prime beneficiary. For investors seeking to capitalize on e-commerce growth, corporate sustainability mandates, and the Midwest’s logistical heartbeat, this is a rare opportunity to align with a developer that’s not just building warehouses—but future-proofed ecosystems.

Act now before these leases—and the returns they promise—are fully occupied. The next decade belongs to those who own the right infrastructure.

Data sources: Dermody Properties press releases, CBRE 2023 Industrial Report, Colliers International market analysis.