Flipper Alert: Some Flippers Take Losses in 1620 S. Michigan
I last chattered about 1620 S. Michigan in the South Loop in September 2007. Developed by CMK, the building has 249 units. Closings began in Summer 2006.
At the time, I discussed three units where the flippers were in a world of pain. They were:
Unit #406: 2 bedroom/2 bath, 1148 square feet
- Sold for $331,000 in August 2006
- Was listed for $329,900 with parking extra for $35,000
Unit #803: 2 bedroom, 2 bath, 1100 square feet
- Sold for $333,000 in September 2006
- Was listed for $335,000 with parking included
- Listing said “never lived in”
Unit #1001: 2 bedroom, 2 bath, 1085 square feet
- Sold for $337,500 in September 2006
- Was listed for $349,000 plus $35,000 for parking
- Listing said “never lived in”
None of the three is currently listed for sale. Unit #1001 is now available for rent for $2000 a month.
The other two didn’t sell. Unit #406 rented for $1600 a month. Unit #803 has just been withdrawn from the market. (Thanks to the Tipster who provided the listing information.)
Several flips have sold since we last chattered about the building.
Unit #705: 2 bedrooms, 2 baths
- Sold in August 2006 for $387,000
- Sold in October 2007 for $379,000
Unit #805: 2 bedrooms, 2 baths
- Sold in September 2006 for $389,000
- Sold in January 2008 for $382,000
Unit #905: 2 bedrooms, 2 baths
- Sold in September 2006 for $385,000
- Sold in Spetember 2007 for $406,000
Unit #1101: 2 bedroom, 2 bath, 1078 square feet
- Sold in October 2006 for $344,000
- Sold in November 2007 for $355,000
One seller has gotten into trouble and was trying a short sale.
Unit #904: 2 bedrooms, 2 baths, 1174 square feet
- Sold in October 2006 for $410,000
- Currently listed as a short-sale for $369,900 plus $15k for parking
- Scheduled for foreclosure auction in mid-February 2008 for $344,866
- Assessment of $366 a month
It took some of the flippers a year to sell and they took a loss. The question will be: how long will other flippers be willing to hold on?
Here are some pictures of two others units also available in the building so you can get an idea of the interiors. It is signature CMK-style with concrete and modern finishes.
Unit #305: 2 bedrooms, 2 baths, terrace unit, listed for $479,000
Unit #1219: 2 bedrooms, 2 baths, 1077 square feet, listed at $319,900
Current stats for the building out of 249 units:
- 17 for sale
- 7 for rent
If $1600 is the real base rent going forward, $325k (including the parking) is not too bad a price, if you have $65k for the down payment and intend to live there for a reasonably long time.
But they probably should be about $250/ft plus $15-20k for parking and a small /ft adjustment for higher floors–maybe $1 to $2. So, 406 should be about $300-305k including the parking.
They look okay, but are basically replacements for rental apartments, and so shouldn’t have much of a premium over rental costs. Any idea what the assessments are? Given that the view pics are old, anything being built to block the view from 1219?
I toured 1720 next door, and I recall the assessments were quite reasonable–and even after the developer finishes up, the assessments for CMK buildings don’t tend to go up (which often happens). These look quite similar to 1720, too, and I will say that while 1720 is not luxury (and has no pretensions of being so), the units are pretty nice. If you like modern, which I do.