10/07/2026
Amazon Buys Vacant Goose Island Vertical Warehouse for $195 Million After Developer Takes Loss
SubX.News® Economy Report | October 6, 2026
CHICAGO — Amazon has purchased Chicago's massive vertical warehouse near Goose Island for $195 million, acquiring a specialized logistics facility that had remained vacant since its completion in late 2024.
Five-level property at 1237 W. Division St., between Goose Island and the Kennedy Expressway, is the Midwest's first modern vertical warehouse and the sale ranks among Chicago's highest-priced transactions for a single industrial property.
Project was developed by Chicago-based Logistics Property Co. on speculation, meaning it was constructed without a tenant already committed to occupy it. The development encompasses nearly 1.2 million square feet overall, including about 571,000 square feet of warehouse space and extensive parking connected by ramps.
Developer paid approximately $55 million for the 11.5-acre former Peoples Gas site and obtained a $150 million construction loan in 2022. Those two figures alone total about $205 million, compared with Amazon's $195 million purchase price. Earlier reporting said the developer's full investment was higher and that a sale to Amazon was expected to result in a substantial loss of equity.
Actual loss therefore cannot be calculated simply as $10 million from those figures because a construction loan is financing rather than necessarily the project's entire construction cost, and other equity, financing and carrying costs may have been involved.
Reaction to the deal focused heavily on Amazon's negotiating position after the highly specialized property sat vacant.
“Close to a $50 million loss for the developer,” commentator Ed Silha wrote in reaction to the Crain's report. “This place was essentially purpose-built for 1 company: Amazon.”
“Amazon knew that too,” Silha continued. “So they let it sit empty for years, waited for the debt to catch up with the developer, then swooped in and bought it for a song.”
Real estate commentator A.J. Manaseer similarly called the transaction a “brutal loss for the developers,” pointing to the $205 million represented by the reported land purchase and construction loan versus the $195 million sale.
“Amazon got this brand new, Class A+ facility just outside downtown Chicago for far less than the cost to build it,” Manaseer wrote.
Manaseer characterized the development as an example of the risk of constructing a specialized property with a single likely end user in mind.
Public reporting supports part of that broader picture but does not establish that Amazon deliberately waited for the developer to become distressed. The building was constructed speculatively, completed in late 2024 and remained vacant while Logistics Property sought a major tenant before putting it up for sale in October 2025.
Amazon emerged as the prospective buyer this summer. July reporting said the company was negotiating to acquire the property at a price expected to be well below the developer's total investment.
Facility's unusual vertical design was intended to overcome the shortage and expense of industrial land near Chicago's densely populated core. Vehicles can travel between levels, while the property provides capacity for approximately 1,590 cars or 763 vans.
Location gives Amazon immediate access to the Kennedy Expressway and neighborhoods surrounding downtown, making the property particularly suited to rapid urban distribution. CoStar reports Amazon plans to use the building to support fast fulfillment across Chicago.
Transaction effectively turns one of Chicago's most ambitious speculative industrial developments into an Amazon logistics property while leaving its original developer absorbing the financial consequences of building first and finding the ultimate user later.
