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Irish firm targeting Chicago Properties - An Irish investment firm is teaming up with nationally-known Chicago broker Sean Conlon in a joint venture expected to draw more Irish investments to the US commercial real estate market.
Tuesday May 08 2007
Daniel Duggan
An Irish investment firm is teaming up with nationally-known Chicago broker Sean Conlon in a joint venture expected to draw more Irish investments to the US commercial real estate market.
The partnership, to be called Conlon & Co. (Ireland) will have Conlon’s domestic operation working in conjunction with the Irish-based investment and development company Investor First.
The move will continue the trend of foreign capital finding a place in the Chicago real estate market.
With other Irish firms such as Garret Kelleher of Shelbourne Developments and Anglo Irish Bank involved in high-profile projects such as Chicago’s Spire, Investor First CEO James Carroll says the time is right to market US commercial real estate to Irish investors. Carroll spoke with The Illinois Real Estate Journal during a recent trip to Chicago.
The joint venture will target real estate investment in other major US cities and on the coasts — but will be focusing on several high-profile Chicago assets in the near future, Carroll says. He declined to name the sites but says he is close to purchasing “several” high-profile office buildings in addition to two retail opportunities, a refurbished office development and a 300-bed hotel development — all in the Chicago area.
The venture currently has four employees dedicated to it with the expectation to expand to 15 people soon.
The first deals will be in working with specific investors, but Carroll plans to have a dedicated investment fund started soon.
“Once we get a couple deals done, get our feet under the table, we’ll have a proprietary investment fund, probably in three to six months. That will be at least couple hundred million [dollars].”
Massive liquidity in global markets, paired with the sophistication of US markets compared to others in the world makes now the right time to move on the joint venture, Carroll says. Many Irish real estate investors are looking to Eastern Europe which is a far less sophisticated market.
The barrier to US investment has been that foreign investors find themselves lacking a local partner. The key to bringing foreign money to this market, he says, is the talent on the ground.
“In real estate, if you get off a plane and you’re waving a checkbook around, someone will come and take it off you. Investment money travels. Market knowledge does not travel. It’s a shoe-leather business.”
The perfect tie to the US market is Conlon.
Carroll came across the Irish-born real estate magnate after watching a documentary aired in Ireland “Made in America,” which featured Conlon’s rags-to-riches real estate story.
He was so moved by Conlon’s story that he contacted him.
“What he’s doing is almost a mirror image of what I’m doing,” Carroll says. “I approached Sean because he has the knowledge and the connectivity to originate these deals. He has a finger on the pulse of where property is moving.”
Since then, the two have put together the partnership in an attempt to pair Irish capital with Conlon’s talents for finding a place for it. With his expertise in Chicago, much of the venture’s attention will be focused here.
An official launch for the venture will be held later this month in Ireland.
According to a recent Jones Lang LaSalle report, a record number of global transactions were completed in 2006 at $682 billion. Direct commercial real estate investment in the Americas reached $283 billion in 2006, up 31 percent on 2005, the group reported.
Carroll says he hopes to be meeting with Chicago-area developers and brokers soon to help with something he called “creeping developer’s disease.”
“That means that developers always have more opportunities than they have money. So for someone who has the local expertise and the opportunity, we’re open to those opportunities and will have the money to back them.”
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