Chicago Housing Market: South Loop High Rise Hom Chicago Is Canceled
Crain’s Chicago Business is reporting that the south loop condo market is slowing and some projects are now being canceled. From Crain’s:
Downtown condo developers scrapped or deferred pro-jects comprising 485 units by the end of the second quarter, the report says. That includes a 146-unit high-rise at 2039 S. Prairie Ave. in the South Loop, first called Aristrocrat Tower, then renamed Hom Chicago.
“The market’s been slow,” says William Warman, the project’s developer. “In the South Loop, there are a lot of new buildings online.”
Mr. Warman is canceling purchase contracts for about 35 units and returning the buyers’ earnest money, but he may restart the project next year if the market improves. He also has put the development site up for sale with an asking price of $12 million.
Anyone who walks around the south loop can see that construction continues unabated. How can there be buyers for all of those units? There aren’t. Yet many of the buildings are going up with only 60% sold (Vetro, Burnham Pointe, Library Towers).
According to the Crain’s article, there is already a glut of condos for sale in all of downtown:
Downtown developers are on pace to sell about 4,000 condos and townhouses this year, less than half the 8,162 units they sold in 2005, a record year, according to Appraisal Research. Total unsold units rose more than 50% over the past two years, to 7,689 — a number that could fall as more developers scuttle projects.
But the glut isn’t detering some developers. CMK just launched a sales center for 235 W Van Buren, about 700 new condos priced from $179,000.