Crib Chatter

We’ve been chattering for over a year about the dozens of luxury apartment high rises that have been built in the Green Zone and the implications of all those units.

But the boom isn’t over yet.

Thousands more apartments are expected to come online in the next two years.

Crain’s reports:

But the once-hot market is getting chillier amid an unprecedented development boom. Developers will complete a record 4,500 downtown apartments this year, 3,500 in 2018 and as many as 5,000 in 2019, Integra predicts.

While demand for apartments is as strong as it’s ever been, it’s not keeping up with supply. Absorption, the change in the number of occupied units, will total about 2,900 units this year—also a record—and 3,000 in both 2018 and 2019, according to Integra. Put another way, downtown supply growth—13,000 new apartments over three years—will exceed demand by 4,100 units, or 46 percent.

Apparently, apartment landlords are now getting nervous.

This winter, the incentives at the luxury buildings have increased as more units sit empty.

“The difference now is there’s more fear of the unknown. We’re getting aggressive because you don’t know,” says Jim Letchinger, president of Chicago-based JDL Development, which opened a 250-unit tower at 640 N. Wells St. over the summer. “Is this just seasonal, or is this something else?”

Leasing in the building is ahead of schedule but has slowed considerably. The building’s conversion rate, or the percentage of people who visit its leasing office and sign leases, has dropped to about 20 percent from 40 percent six months ago, Letchinger says.

JDL has offered two months’ free rent for some apartments, but only on leases for 17 months or longer, he says. In exchange for free rent, many landlords require leases longer than 12 months.

Arkadia Tower, a 350-unit West Loop high-rise that opened in 2015, was recently offering two months’ free rent for leases that begin Nov. 30, plus $100 off the monthly rent, according to an email sent out to brokers. On a hypothetical apartment listed for $2,700 per month, the deal works out to a nearly 20 percent discount. The email (subject line: “Christmas Came Early @ Arkadia West Loop!”) also offered a broker commission equaling a month and a half of rent.

“Right now is a great time to rent an apartment,” said Aaron Galvin, founder and CEO of Luxury Living, an apartment broker. “The renter does want to feel like they’re winning in some way now. . . .They’re expecting to get something.”

New tenants at one Loop building get to spin a wheel for cash prizes ranging from $150 to $1,000. Other landlords are offering free Netflix, internet, parking—even televisions.

But according to Crain’s, it’s not just the new buildings that are offering free rent. Older buildings that are already full are offering it to keep tenants which is unusual.

With older buildings feeling competitive pressure, it made me wonder, what does this mean for the condo landlords?

In years past, the condo rental would have been preferred because those buildings were considered “nicer” and more up-to-date, but today’s luxury apartment towers have newer finishes. Many condo towers are now 10+ years old.

Additionally, apartment buildings often offer even nicer amenities, including rock climbing walls and free coffee daily in the lobby.

What’s a condo landlord do to compete?

Will they have to offer 1-3 months free rent like the apartment buildings?

Will they have to waive move-in fees because the luxury apartment buildings are?

Do they need to renovate their unit so they have modern finishes?

Or simply lower the rent enough until they find someone?

Just doing a quick search of condo rentals downtown, and you can see some that are sitting on the market for several months. Yes, it’s the “slow season” but every month you don’t have a renter, is lost money.

Just doing a search of the listings and I find:

• Near North Side: 796 properties listed for rent
• Loop: 252
• Near West Side: 214
• West Town: 306
• Near South Side: 180
• Lake View: 408

Some of these will also be single family homes and townhouses, not just condos. And some apartment landlords are also listing their more expensive units on the MLS.

But this is a lot of inventory in the “slow season.”

Here’s an example of what is going on out there.

This 2-bedroom in The Pinnacle at 21 E. Huron in River North has been on the market since August 2017.

It’s a corner west-facing unit with 1446 square feet.

It has hardwood floors in the living/dining rooms.

The kitchen has dark wood cabinets, granite counter tops and black appliances.

The bathrooms are marble.

The unit has central air, washer/dryer in the unit and it looks like garage parking is included (although I’m not 100% sure on that.)

Since listing in August 2017, the price has been reduced 12.5% to $4200 a month.

You can see the pictures here.

21 E. Huron #1407: 2 bedrooms, 2 baths, 1446 square feet

• Listed for rent in August 2017 for $4800 a month
• Reduced
• Currently listed at $4200 a month
• Looks like parking might be included. There’s an attached garage
• Indoor pool
• Movie theater
• Bedroom #1: 12×17
• Bedroom #2: 12×12

What is its competition?

Just across the street is the new construction modern tower 8 E. Huron (on the corner of Huron and State.)

It has a rooftop pool and curated art on every floor.

It has hardwood floors throughout.

The kitchen has white modern cabinets.

The bathrooms aren’t marble but have white modern finishes.

You can see pictures of that apartment here.

8 E. Huron #903: 2 bedroom, 2.5 baths, 1285 square feet

• Just came on the market at $4340 a month
• Looks like it might include the parking
• The building just opened- not sure what incentives they’re giving
• Bedroom #1: 14×13
• Bedroom #2: 12×11

Will 2018 be brutal for condo landlords trying to compete?

Apartment Landlords’ New Pitch: Let’s Make a Deal! [Crain’s Chicago Business, by Alby Gallun, November 22, 2017]

The Illinois Association of Realtors is out with the October sales data. It was actually a ho-hum month, not hot but not cold.

The city of Chicago saw year-over-year home sales hold steady in October 2017 with 2,047 sales, compared to 2,046 in October 2016. The median price of a home in the city of Chicago in October 2017 was $262,000, up 0.7 percent compared to October 2016 when it was $260,100.

Thanks to G for all the data on October sales going back to 1997:

October Chicago sfh/condo/th sales and median

• 1997 1,731 $129,900
• 1998 1,855 $138,000
• 1999 1,978 $159,500
• 2000 2,106 $174,710
• 2001 2,177 $200,000
• 2002 2,503 $215,000
• 2003 2,996 $236,000
• 2004 2,651 $241,000
• 2005 2,846 $268,500
• 2006 2,630 $278,000
• 2007 2,007 $285,000
• 2008 1,564 $261,000
• 2009 2,068 $215,000
• 2010 1,225 $183,000
• 2011 1,324 $162,000 (44% short/REO sales)
• 2012 2,009 $175,000
• 2013: 2,231 $218,500
• 2014: 2,128 $236,000
• 2015: 2,173 $240,000
• 2016: 2046 $260,100
• 2017: 2047 $262,000

While 2016 and 2017 sales totals were at 4-year lows for October, nothing comes close to the depressed market of 2010 and 2011.

“Steady seems to be the name of the game, and this fall is proving no different,” said Rebecca Thomson, president of the Chicago Association of REALTORS® and Vice President of Agent Development at @properties. “Although inventory continues to tighten, we now see an increase in new construction that is fueling price gains, particularly in the condo market. As we enter the holiday season, between the healthy economy and strong demand, these trends show little signs of slowing down.”

“While consumer sentiment about the economy appears positive, there is still hesitation about the housing market,” said Geoffrey J.D. Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois. “However, mortgage applications have increased and prices and sales in both Illinois and Chicago increased on an annual basis, a trend that is forecast to continue into 2018.”

Average market time statewide fell again, to 54 days down from 60 days in October 2016.

Statewide inventory also dropped 10.4% to 57,911 from 64,601.

The average 30-year mortgage rate remained below 4% at 3.9%. No one is panicking that rates may rise even though the Fed is expected to raise rates again in December.

Does anyone see this market loosening any time soon?

If you really wanted to move, should you try and buy during this slow winter market instead of waiting until spring when it could be crazy again?

Illinois home sales inched slightly higher in October  [Illinois Association of Realtors, Press Release, November 21, 2017]

This 2-bedroom in the Sangamon Lofts at 411 S. Sangamon in the West Loop came on the market in October 2017.

This is a 1800 square foot authentic loft with timber ceilings and beams along with exposed brick and hardwood floors.

The listing says it was “gutted to the studs.”

The kitchen has dark cabinets along with Wolf and Subzero appliances and stone counter tops.

The unit has southern exposure with industrial windows.

The listing says there are 2 fully enclosed bedrooms, which you don’t always see in lofts.

There’s central air, washer/dryer in the unit but no parking, although the listing says there are rental and purchase options nearby.

With all the new construction in the West Loop, are old-style lofts still in demand by buyers?

Nathan Binkley at Dream Town Realty has the listing. See the pictures here.

Unit #6C: 2 bedrooms, 2 baths, 1800 square feet

• Sold in August 2000 for $240,000
• Sold in May 2003 for $278,000
• Sold in January 2007 for $340,000
• Sold in October 2008 for $327,500
• Originally listed in October 2017 for $599,000
• Currently still listed for $599,000
• Assessments of $506 a month
• Taxes of $5521
• Central Air
• Washer/dryer in the unit
• No parking- but options for rent or purchase available nearby
• Bedroom #1: 18×15
• Bedroom #2: 14×12

This 6-bedroom historic mansion at 817 W. Hutchinson in the Buena Park neighborhood of Uptown just came on the market.

If it looks familiar, that’s because we’ve chattered about it several times since 2012.

See our October 2012 chatter here.

The Claude Seymour House is one of the many historic mansions that line Hutchinson on this landmarked block.

The Elite Street column in the Chicago Tribune highlighted it in 2013:

Designed by Prairie-style architect George Washington Maher and completed in 1913 for jewelry wholesaler Seymour, the more than 12,000-square-foot mansion has six bedrooms, four full baths, two half baths, leaded stained-glass windows, a grand mahogany staircase, three fireplaces, mahogany millwork throughout, an eat-in kitchen and a coach house atop a two-car garage.

The property has 136 feet of frontage and a wraparound yard.

If you recall, the house is on 5 city lots measuring 136×140.

It has a 2-car garage plus space for 2 cars on the driveway.

It has most of it’s original vintage features, including moldings, stained glass, and a carved staircase along with 3 wood burning fireplaces.

All 6 bedrooms are on the third level.

The kitchen has stainless steel appliances and what look like stone counter tops.

There’s also a library, game room and a big lower level recreation room.

It has central air.

Will the hot luxury market, thanks to the record high stock market, finally help sell this landmarked mansion?

Alfred Cohen at Coldwell Banker now has the listing. See the pictures here.

817 W. Hutchinson: 6 bedrooms, 4 baths, 2 half baths, 12000 square feet, 2 car garage, studio

• Sold in November 1993 (no price listed)
• Originally listed in March 2011 for just 2 weeks at $5.195 million
• Re-listed in October 2011 for $4.995 million
• Lis pendens foreclosure filed in December 2011
• Was listed in October 2012 at $4.995 million
• Reduced
• Was listed in August 2013 at $4.5 million
• Withdrawn in February 2014 listed at $4.5 million
• I can’t tell if the bank now owns it
• Re-listed in November 2017 at $5.69 million
• Taxes are now $88,500 (they were $81,517 in August 2103 and they were $21,652 in October 2012)
• Central Air
• 3 fireplaces
• Bedroom #1: 19×19 (third floor)
• Bedroom #2: 16×14 (third floor)
• Bedroom #3: 17×12 (third floor)
• Bedroom #4: 14×11 (third floor)
• Bedroom #5: 10×15 (third floor)
• Bedroom #6: 12×20 (third floor)
• Recreation room: 50×28 (lower level)

This 4-bedroom vintage row house at 121 W. Delaware in the Gold Coast came on the market in September 2017.

Built in 1881, it is on a 21×52 lot.

The row house has many vintage features including 11’5″ ceilings on the first floor, hardwood floors, 4 fireplaces, including in the living room and the dining room, crown moldings, ceiling medallions and what looks like stained glass in some of the doors.

There’s a chef kitchen with white cabinets, stainless steel appliances and granite counter tops.

The listing says the dining area leads to a balcony for grilling (but doesn’t show the pictures of it.)

The master suite is on the second floor with closets, the master bathroom a study and an enclosed south-facing porch where the listing says you can have morning coffee (but, again, the pictures don’t actually show this room which is too bad because I want to see what that looks like.)

Two other bedrooms are on the third floor along with the laundry and a second kitchen, which enables you to bring food up to the private rooftop deck.

The rooftop deck has city views, irrigated flower and garden planters and a gazebo.

If you’re looking for an in-law unit or an apartment for a nanny, the lower level has a walk-out apartment with a separate entrance with 1-bedroom and bath along with a living room and dining space and its own kitchen.

The house has central air and while it doesn’t have parking, the listing says there are 3 deeded indoor garage parking spaces “nearby” included.

Is this the ideal set-up for those looking for an in-law unit but who also want the vintage flavor?

Kimberly Gleeson at Baird & Warner has the listing. See the pictures here.

121 W. Delaware Place: 4 bedrooms, 3.5 baths, 3927 square feet

• Hasn’t sold since 1988
• Originally listed in September 2017 for $1.875 million
• Currently still listed for $1.875 million
• Taxes of $26,895
• Central Air
• 4 Fireplaces
• 3 deeded indoor garage spaces included nearby
• Bedroom #1: 13×16 (second floor)
• Bedroom #2: 13×15 (third floor)
• Bedroom #3: 12×13 (third floor)
• Bedroom #4: 12×14 (basement)
• Study: 7×11 (second floor)
• Enclosed porch: 6×12 (second floor)
• Second kitchen: 9×12 (third floor)

This 2-bedroom in The Grant at 1201 S. Prairie in the Museum Park neighborhood of the South Loop came on the market in September 2017.

Built in 2008, The Grant has 298 units and is a full amenity building with an indoor pool, gym and parking garage.

Some of you may recall that this building was one of three high rises that went bust in the Museum Park development during the Great Recession.

Related Midwest was brought in to renovate and sell the remaining units, which they did as the condo market improved from 2013 to 2015.

This unit has south and east city views from floor to ceiling windows on the 29th floor.

The kitchen is one of the kitchens that Related renovated using Snaidero modern gray and white cabinets, quartz counter tops and Subzero and Wolf appliances.

There’s a master suite with an organized closet and spa-like en suite bath with dual vanities.

The listing also describes a 8×6 den/office which is in what looks like a hallway off the kitchen.

This building is next to the One Museum Park high rise (on the east side) but it’s also next to the under construction mega-tower apartment building that will be at the corner of Michigan and Roosevelt Road (on the west side).

This unit was listed for $750,000 in September 2017 and was reduced to $700,000 plus $40,000 for parking.

If you love high rise views, is this unit a deal?

Leigh Marcus at @Properties has the listing. See the pictures here.

Unit #2905: 2 bedrooms, 2 baths, 1639 square feet

• Sold in February 2014 for $689,000 (included the parking)
• Originally listed in September 2017 for $750,000 (not sure if it included the parking)
• Reduced
• Currently listed for $700,000 (plus $40,000 for parking)
• Assessments of $654 a month (includes doorman, cable, exterior maintenance, scavenger, snow removal, concierge, indoor pool, gym, sundeck, lounge with pool table, playroom, theater, dog run and grooming room)
• Taxes of $11344
• Central Air
• Washer/Dryer in the unit
• Bedroom #1: 14×13
• Bedroom #2: 12×11
• Den: 8×6

This 3-bedroom in the Park Newberry at 55 W. Delaware in the Gold Coast came onto the market in September 2017.

This building was constructed in 1998 and has 182 units and a garage.

It’s a full service building with a doorman and an exercise room.

This is a southeast corner unit with wide plank custom hardwood floors.

The living room has a fireplace with a stone surround accent wall and a balcony.

The listing says the kitchen is “newly renovated” with 42″ custom cabinets, granite counter tops, stainless steel appliances, and a built-in breakfast table.

There’s a master suite with 2 custom closets, a marble bath, with heated floors and a steam shower.

There’s central air, in-unit washer/dryer and the garage parking is $55,000 extra.

When this building was first constructed, this was a more “fringe” area of the Gold Coast. But in recent years, a half dozen luxury condo buildings, including the soon to be completed No 9 Walton, have been built nearby.

This unit was originally listed for $1.145 million in September 2017 and has been reduced to $1.1 million, if you include the parking.

Is this unit a deal compared to the price points in nearby building like 30 W. Oak, No 9 Walton, the Elysian and 10 E. Delaware where the 3-bedroom units are all priced much higher?

Bari Levine at @Properties has the listing. See the pictures here.

Unit #606: 3 bedrooms, 2.5 baths, 2297 square feet

• Sold in July 1998 for $408,000 (included the parking)
• Originally listed in September 2017 for $1.145 million
• Reduced
• Currently listed for $1.045 million (plus $55,000 for parking)
• Assessments of $1125 a month (includes heat, a/c, gas, doorman, cable, exercise room, exterior maintenance, lawn care, scavenger, snow removal)
• Taxes of $14,294
• Central Air
• Washer/Dryer in the unit
• Fireplace
• Bedroom #1: 18×14
• Bedroom #2: 15×11
• Bedroom #3: 14×14
• Family room: 13×10

This top floor 2-bedroom at 837 W. Newport in Lakeview came on the market in May 2017.

This 3-unit building was a 2007-2008 gut rehab of a vintage building.

It has luxury finishes including dark stained hardwood floors and wainscoting.

The kitchen has 42″ dark stained cabinets, stainless steel Viking appliances and granite counter tops.

The master suite has a shower with rain, steam and body sprays.

There’s a deck at the back of the unit, which has the preferred layout of access without having to go through the master bedroom to get there.

There’s also a staircase to the second floor which has a den or a bonus space with a wet bar as well as a fully customized rooftop deck with fire pits, a waterfall, speakers, lighting, and several custom seating areas.

The unit has central air, washer/dryer in the unit and 1-car garage parking.

This property came on the market in May 2017 for $779,000 and has been reduced $80,000 to $699,000.

It is also available for rent, listed in September 2017 for $4300 a month but reduced to $3950 a month.

This unit has been listed for sale for 7 months.

With inventory at record lows, why isn’t this selling?

Christopher Mulka at @Properties has the listing. See the pictures and floor plan here.

Unit #3: 2 bedrooms, 2 baths, 1900 square feet

• Sold in March 2008 for $672,500
• Sold in July 2010 for $630,000
• Originally listed in May 2017 for $779,000
• Reduced
• Currently listed for $699,000
• OR you can rent it
• Originally listed for rent in September 2017 for $4300 a month
• Reduced
• Currently listed for $3950 a month
• Assessments of $180 a month (includes exterior maintenance)
• Taxes of $10,987
• Central Air
• Washer/Dryer in the unit
• Garage parking included
• Wet bar
• Private rooftop deck
• Fire pits/waterfall on the rooftop deck
• Bedroom #1: 14×14 (first floor)
• Bedroom #2: 11×11 (first floor)
• Bonus room/den: 11×20 (second floor)

This 2-bedroom in Altgeld Court at 1300 W. Altgeld in Lincoln Park first came on the market in March 2017.

Converted into condos in 1991, it has 44 units and gated, outdoor parking.

This building is kind of a hybrid loft/condo mix.

The unit has high, industrial style ceilings with floor to ceiling windows, and some exposed brick.

The listing says this is a rare end unit with east, south and west exposures.

The kitchen has maple cabinets, stainless steel appliances and granite counter tops.

There’s a marble master bathroom.

I can’t tell from the pictures if there are windows in either bedroom. There are only pictures of one of the bedrooms and there are no windows shown in that shot.

There’s a second private entrance which leads to a 250 square foot private patio.

It has central air, washer/dryer in the unit and rare 2-car parking, which is gated.

This unit was listed in March 2017 for $579,000 and has been reduced $40,000 to $539,000 but still hasn’t sold.

With inventory near all time lows, why isn’t this selling?

Michelle Lezotte at @Properties has the listing. See the pictures here.

Unit #115: 2 bedrooms, 2.5 baths, no square footage listed

• Sold in October 1991 for $191,000
• Sold in June 1996 for $225,000
• Sold in April 2000 for $325,000
• Sold in September 2005 for $470,000
• Originally listed in March 2017 for $579,000
• Reduced
• Currently listed at $539,000 (includes 2-car gated parking)
• Assessments of $383 a month (includes exterior maintenance and scavenger)
• Taxes of $7191
• Central Air
• Washer/dryer in the unit
• Bedroom #1: 15×12
• Bedroom #2: 12×11

This 4-bedroom at 1411 N. State Parkway in the Gold Coast came on the market in March 2017.

This 13 unit vintage mid-rise building is unique in the Gold Coast because it has an elevator.

This unit has a formal entry way, built-ins, crown molding and a wood burning fireplace.

There’s a gallery hallway.

The kitchen is “new” and has white custom cabinets, eat-in space and top end stainless steel appliances.

It has the much sought after 4 bedrooms with a master suite that has a bath and a separate sitting room.

There’s outdoor space in the form of a 15×6 terrace that overlooks State Parkway.

The unit has the other features buyers look for including parking, a real laundry room and space pak cooling.

The building doesn’t have a doorman but it does have a live-in engineer.

Listed in March 2017 for $1.825 million, it has been reduced $60,000 to $1.765 million.

4-bedroom condos are hard to find, especially with all the other features like parking.

This unit has been on the market 9 months now.

Even though overall inventory is at multi-year lows, are there too many luxury properties on the market?

Emily Sachs Wong from @Properties has the listing. See the pictures here.

Unit #2N: 4 bedrooms, 3 baths, 2700 square feet

• Sold in March 1996 for $915,000
• Sold in June 2013 for $1.35 million
• Originally listed in March 2017 for $1.825 million
• Reduced
• Currently listed at $1.765 million (includes one parking space)
• Assessments of $1959 a month (includes exterior maintenance, lawn care, scavenger, snow removal)
• Taxes of $21,006
• Space pak cooling
• Washer/dryer in the unit
• Wood burning fireplace
• Elevator building
• Bedroom #1: 17×15
• Bedroom #2: 14×13
• Bedroom #3: 14×11
• Bedroom #4: 14×12
• Sitting room: 13×11
• Laundry room: 11×7
• Terrace: 15×6