Flipper Alert: Two Bedrooms Under $500k in ParkView at 505 N. McClurg
Why are investors who intend to flip their units closing on them in the new construction condo towers? Only they know.
But it wouldn’t seem to make financial sense.
Take these two units on the market in the new Streeterville highrise, ParkView at 505 N. McClurg. Closings just started in the building. It was only about 75% sold by the developer.
Current stats on the building on the MLS (there may be more for sale from the developer than are listed):
- 36 for sale
- 13 for rent
Some may be both for rent and for sale.
These two sellers would be lucky to break even- and that’s IF they sell quickly. If the market time drags out (as we’ve seen in other new construction buildings) the loss could be quite large.
Unit #2102: 2 bedrooms, 2 baths, 1464 square feet
- Sold in May 2008 for $795,500 (included the parking)
- Currently listed for $799,900 (parking is $60k)
- Assessments of $640 a month
- Virginia Properties has the listing
Want a two bedroom around $500,000? This one could be for you. The developer is currently selling 950 square feet one bedrooms in the building for $519,000 (plus parking).
Unit #601: 2 bedrooms, 2 baths, 1196 square feet
- Sold in May 2008 for $517,000
- Currently listed for $499,000 plus $60k for parking
- Assessments of $413 a month
- Urbanspan, LLC has the listing
Flipper #1 will take a well-deserved beating. Do some people just have no economic sense whatsoever?
“Can’t lose in Chicago Real Estate.” ™
I don’t know how the developer can be selling 1BR units for $519,000 when there are at least two units listed on the MLS for less. I see a 1BR for $420,000 and another for $450,000.
This building is one of my favorites from the boom. Very nice looking from the outside and the interior is fairly well designed (relative to the horrid layouts common to new construction in the last 10 years).
The building looks nice except for those ugly balconies.
I could see closing if it’s a condo -investor- who believes in the long term potential of where Streeterville is headed…especially if you’re going in with substantial equity so you’re not taking too much a hit on your early year rental income. But for a flipper, yeah, just walk away from your deposit and you’ll be ahead.
Ouch.
I personally still like the 600 North Fairbanks better than this building. Pricing wise it may be comparable or probably slightly more expensive, but finishes wise I don’t think this building is even close to what 600 North Fairbanks’s puts in.
Little Boi: If you go by pricing on the two bedroom above compared to the two bedrooms in 600 NF, the list prices are at least $150k more in 600 NF. Similar square footage (and the ParkView units might even be slightly larger.)
That’s a lot of marble and appliances.
But I agree with you- from what we’ve seen so far- the finishes are more of the “luxury” variety in 600 NF.
Sabrina: do you have any updates on Library Tower, Museum Tower IV, Marquee building – basically buildings that were completed and are now closing.
Thanks!
Aleks: Library Tower is only just closing (if it even is actually closing yet.) So you have to wait a few weeks/months to actually get any info on what is happening in the building.
I talked about Museum Tower IV not too long ago.
I’ll do an update about The Marquee shortly. Last one I did was a few months ago.
David,
Most of the excess condo’s trying to be turned over are not from professional flippers.
These are regular folks who have had 10% down for a couple of years and think they can close on their units and try to get their money back.
You have to realize that most of their interaction is with the sales staff of a particular building,and they are not as aware of the situation like some people who frequent this board.
Even if they thought about walking away from the deal,usually the strongly worded letter from the developer’s attorney will convince them to close.
In alot of cases,these people ar living in the suburbs and it is their 1st time purchasing a condo downtown and have no idea what is going on.
Sabrina,
In all fairness, there are no 6th floor units in 600 North Fairbanks, so it’s not so straightforward.
Speak to the sales office and get prices on the units on higher floors, you’ll see they start to go up pretty quickly.
I haven’t done a full analysis of prices vs the two buildings, but my first impression is that 505 N McClurg is too close to 600NF prices.
Just browsing the listings, and sticking to the same floor:
1. Unit 2107 in 600NF is asking 580k at about 1200sqft I believe (483/sqft)
2. Unit 2102 in 505 N McClurg is asking 799k at 1464sqft (546/sqft)
That makes 505N McClurg significantly more expensive on a price per sqft basis than 600NF.
Given they are different size units, with different exposure, but I do see Little Boi’s point.
Does anyone know where to find rental listings for apartments in this building?
Thanks,
Ted
Ted:
Look on Craigslist or the realtor websites (by address.) Rubloff has a good rental section its website.