Mike Scilingo, president at Urban Innovations (“UI”), started his career in commercial real estate, in May 2000, when he came to UI as a Commercial Asset Manager. Scilingo says he viewed coming to UI as an opportunity to work in a real operating business rather than being strictly on the investment and finance side of things.
In an interview with Illinois Real Estate journal, he shared his passion for his hometown and career, as well as current updates in commercial real estate.
“I spent the first 15 years of my career in financial analysis and private equity investment,” Scilingo said. “Working in the private equity world, I found that the real estate investment deals were the most interesting and nuanced to analyze and try to determine their likelihood of succeeding or failing. Plus, I really liked UI’s core values and the people I met when I interviewed here.”
Many of the things that originally attracted Scilingo to UI, remain the things that has kept him interested in the business after all of these years.
“In real estate, just about everything we do or don’t do ultimately has a tangible impact on the performance of the properties we own, manage, buy or sell. We succeed or fail as a team, so being a part of the right team is absolutely key. I love being a part of team successes. That’s so much more rewarding to me than individual success.”
What he most particularly enjoys about the industry is meeting the leaders and learning about the businesses of the many diverse tenants they have in River North, and on the Near West Side.
“With the vibrancy of the business climate in our sub-markets”, he said, “It’s a great way to keep in touch with tenant needs and how being in a UI building can help their businesses succeed.”
Scilingo said it has not happened nearly as often lately, but what he least enjoys, is that a tenant’s landlord is often the first one that forces them to deal with the reality that their business is failing.
“We try very hard to work with our tenants as much as we can, but sometimes they just can’t make their rent payments after multiple attempts at working out payment plans. That’s never a good day.”
Being a vertically integrated, full-service real estate company, that can seamlessly provide tenants services, ranging from leasing to construction to property management, yet being small enough to make sure tenant needs are met every step along the way, is what Scilingo says, really sets UI apart from other real estate investment companies.
“I believe that is a key component of the high-level of tenant retention we have maintained when other landlords struggled,” he said. “This ultimately leads to better, more stable financial returns for our investors.”
Scilingo said he was delighted that UI was recently able to repurchase two buildings on the Near West Side at 833 W. Jackson and 322 S. Green for an amount that was significantly lower than they sold them for in 2005.
“In about 15 months since then, we have again been able to increase the value of these buildings through key building improvements, and lease-up. These are the types of Commercial opportunities we hope to find more of and capitalize on.”
“We’re also very proud of receiving LEED Core and Shell Certification for the renovation of 222 W. Hubbard”, he said. “That’s a building that had previously been 75 percent occupied by a printing company. It’s now 100 percent occupied by showroom and technology tenants.”
He said UI’s most recent success is still in progress, but it is something they are very excited about.
“UI signed on with the Environmental Defense Fund (“EDF”) to host an EDF Climate Corps fellow for a 10-week program this summer focusing on developing programs to reduce energy usage, greenhouse gas emissions and energy costs. UI was the first manager of Class B commercial buildings to participate this year, and the results will serve as a prototype template for other similar buildings.”
As far as current updates in commercial real estate goes, Scilingo says he thinks the trend of River North loft buildings becoming more desirable for growing technology companies is well-documented at this point.
“We’ve seen rents increase accordingly, and wish we had even more buildings in River North than we do.”
When Scilingo isn’t working, he really enjoys spending time with my family and friends.
“I have three great kids ranging in age from 19-27,” he said. “My wife and I are now starting to get the opportunity to travel a bit more since our kids are older and mostly independent. I have a close group of a dozen or so friends who I have known since either high school or very early in my career, and I play golf with a few of them nearly every Saturday during Chicago’s short golf season. I also organize a weekend golf trip for that group (plus a number of other guys) which we have been doing every summer for the last 23 years.”
Scilingo said based on a recent exercise he went through with a consultant, a fun fact about himself is that, he apparently can hit a golf ball better with his eyes closed than with them open.
Born and raised in Chicago, Scilingo’s lived here his entire life, and thinks it’s a fantastic city from both a real estate perspective and just an overall urban experience.
“I have been fortunate to work for many years with a great team of people committed to having a real impact on further developing River North and other areas of the city where we see opportunities. Having said that, I think the UI platform is one that can be transferred and applied to other urban markets as well which share similar characteristics with what River North was 15, 20 or 30 years ago.”
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