Crib Chatter

A bunch of price reductions are suddenly appearing as “specials” for the month of December.  These are not through developers, but for regular condos or single family homes.

Some of them are like this house in Edgewater.  The Craigslist post says “Dec. Special – 75k off”.

5857 N. Winthrop is a 1905 3 bedroom, 2 bath, 2 car garage Victorian.

• Currently listed for $699,975
• Ron Goldstein at Sudler Sotheby’s has the listing

The listing agent says “carpe diem” on the Craigslist post.  Is it really time to “seize the day”?

My other question is, after December, does the price go back up?  The listing says “December only.”

Just wondering.

One of the most important rules in real estate is to never buy the most expensive home on the block.

The second most important rule is to never renovate your home so that it’s the most expensive home on the block.

Unfortunately, this owner in the South Loop has violated both of these real estate rules.

Built in 2005, this 7 story building sits in the middle of the South Loop at 1601 S.  State.  It has no lake views.  Actually, it has no view whatsoever.  It is also several blocks away from what would be considered the trendier restaurant area.

There are three units for sale in the building. 

1. Unit #4D: 3 bedroom, 2 bath, 1600 square foot unit listed for $435,000 (sold in January 2005 for $375,000)
2. Unit #2D: 1 bedroom, 1.5 bath,  1100 square foot unit listed for $324,900 (sold in January 2005 for $265,000)

And this unit:

Unit #PH7W: 3 bedrooms,  4.5 baths, 6000 square feet

• Currently listed for $2.3 million
• Assessments of $1285 a month
• 3 car garage (included in the price)
• 11 -12 foot ceilings
• 400 square foot terrace off the kitchen
• All one level

The owner clearly went all out on the space with top of the line appliances and finishes.

The most expensive unit to ever sell in the building (other than this penthouse- which I cannot find a prior sale price for) was PH2 that sold for $1.6 million in 2006. (Same unit?  Likely.)

Otherwise, the next most expensive unit to sell in the building was a 3 bedroom, 2 bath condo for $425,000 in February 2005.

Natash Motev at Koenig & Strey has the listing.

Vision on State, a new mid-rise building at 1255 S. State designed by Pappageorge/Haymes in the South Loop, started closings over the summer but has recently picked up steam.

The building was marketed as “affordable luxury” near the El stop at Roosevelt Road.

The floorplans they offered were tailor made for flippers.  There were numerous floor plans:

• 5 one bedroom plans ranging from 610 to 831 square feet
• 1 plan with one bedroom plus den at 880 square feet
• 3 two bedroom 1 bath plans ranging from 890 to 1079 square feet
• Only 1 plan with 2/2 at 1068 square feet
• And 1 plan with 3/1 at 1600 square feet

The statistics in the building so far (out of 253 units):

• 23 units for sale
• 14 units for rent

Flippers are asking, on average, $50,000 more than they paid (on the bigger units.)   Slightly less on the 1 bedroom units.

Here are some examples of what is going on in the building (it looks like the developer did a big dump of a bunch of the closings in November, so some might have technically closed over the summer but didn’t show up in public records until November):

Unit #1116: 2 bedroom, 2 bath, 1068 square feet

• Sold in November 2007 for $358,414
• Currently listed for $384,000 plus $35,000 for parking
• Assessments of $548 a month
• ITown Realty has the listing

Unit #1203: 2 bedroom, 1 bath, 995 square feet

• Sold in November 2007 for $326,548
• Currently listed for $348,900 plus $25,000 for parking
• Assessment of $480 a month
• Century 21 Pro-Team has the listing

Unit #1103: 2 bedroom,  1 bath,  995 square feet

• Sold in November 2007 for $282,097
• Currently listed for $328,900 plus $39,000 for parking
• Listing says it’s priced “way below market value”
• Century 21 Pro-Team has the listing

Unit #1004: 1 bedroom, 1 bath, 724 square feet

• Sold in November 2007 for $235,900
• Currently listed for $308,000 (includes the parking)
• Assessment of $308 a month
• Tenant occupied until August 2008
• Acorn Realty has the listing

There is one flipper with a 1 bedroom that paid $204,900 and is asking $229,000.  At least that’s a little more realistic.  But it’s still sitting on the market.

Rentals range from $1450 for one bedrooms to $2400 for the 1068 square feet 2/2.

Maybe it’s just me, but for the same rental price of $2400, why wouldn’t I rent down the street in a bigger unit at The Columbian (with straight on lake views?)  But that’s just me.

Vision on State [website]

It takes some guts to talk about building yet another new condo tower in downtown Chicago in this market.

According to Crain’s, some developers think the market will rebound quickly. 

The new tower would be done by Belgravia Group (same developer at 600 N. Lake Shore Drive) and would be 50 condos in a 15 to 17 story building.

Can anyone say “exclusive luxury residences”?

According to the article, Belgravia doesn’t have to purchase the property until next fall so they’ll have time to assess whether or not the housing bust is worsening.  From Crain’s:

Key aspects of the firm’s plan, such as pricing, could not be determined. But the long lead time would give Belgravia plenty of time to assess the market.

And despite the widespread slowdown in the downtown market, a very few projects have achieved strong sales, according to the Downtown Chicago Residential Benchmark Report for the third quarter, issued by Appraisal Research Counselors.

“New projects will need to find a niche in this crowded market, and will require a special location or view,” the report says.

Outside of the condo market being in the dumps, does anyone think this is a “prime” area in which to build yet another condo tower? When they announced that Trump was going in at that location I remember some of the city’s top real estate agents saying things like (paraphrasing), “it’s a top name with a B location” – meaning that those with money didn’t want to be down by the river. They want a lake view or Gold Coast.

Is that still true today?

Upscale developer and renovator Melrose Partners, which also recently converted 334 W. Menomonee in Old Town, has taken a different direction on its other conversion at 1919 N. Sheffield in Lincoln Park.

With the market slowing on pricey luxury condos, Melrose has recently cut the price on some of the units at 1919 N. Sheffield and has also apparently combined several of the units.

The three story building was originally supposed to be 8 units (if anyone knows more details, please let me know) but is now only going to be 4.

Originally, the units were priced from $1.05 million to $1.7 million for around 2600 square feet.

Now, they have combined the second and third floors of the building into two huge units.  Unit #3 appears to be under contract.  It was listed for $2.495 million.

Unit #2: 4 bedrooms, 3 baths, 5000 square  feet

• Currently listed for $2.4 million
• Two car parking

Unit #1R: 4 bedrooms, 2.5 baths,  2600 square feet

• Currently listed for $929,000
• 1 car parking

Unit #1F: 3 bedrooms, 2.5 baths,  2600 square feet

• Currently listed for $949,000
• 1 car garage

This picture of the bathroom is taken from 334 W. Menomonee but they have it on the 1919 N. Sheffield listing.  They’re probably using similar finishes.

From the listing:

CHRIS PEACOCK KITCH, SUB ZERO AND WOLF APPL., WATERWORKS TILE AND PLUMB FIXTURES, MARBLE COUNTER TOPS, CUSTOM MILLWORK AND CROWN MOLDING, HIGH CEILINGS, STONE FIREPLACE, ADVANCED INSULATION SYSTEM, ULTRA MODERN AMX TOUCH PANEL TO CONTROL THE LIGHT, A/C, HEAT,

Sudler Sotheby’s is handling the sales.

The old loft conversions have interesting layouts.  Take 110 N. Peoria for instance.  This building was converted in 1993.  It’s in a “prime” area of the West Loop, near the Randolph Street restaurants and Oprah.

There are some really large one bedrooms in the building, including this one that has an old elevator shaft in the middle of the living room (see the brick walls in the photo above).

Unit #206: 1 bedroom, 1 bath,  1450 square feet

• Sold in May 2000 for $252,500
• Currently listed for $323,000 (plus $25,000 for parking)
• Assessments of $319 a month
• Keller Williams West Loop Realty has the listing

The all white kitchen was common in the 1990s loft conversions.  Some people have upgraded the kitchens, some have not.

Question is- what do you do with the elevator shaft?  This owner put a couch in there.  I’ve seen some people put a dining room table in the space.  But there is also space in another part of the loft for that (there is a 17 x 17 “family room.”)

Is it possible to sometimes just have too much free space?

Did you think that flipping was just confined to new construction condos that were in the downtown neighborhoods?  

Nope. 

Catalpa Gardens is a new mid-rise development at 1122 W. Catalpa in Edgewater.  It is distinctive in the neighborhood for its blue and yellow facade.  It will have three towers and 126 units.

The first closings started in September and the flippers are out.  Current building statistics:

• 24 units on the market (some are from the developer)
• 3 units for rent

Unit #413: 2 bedroom, 2 bath, 1070 square feet

• Sold in November 2007 for $325,997
• Currently listed for $369,000 (parking extra)
• W/D in the unit
• Kim Jones at Baird and Warner has the listing

Unit #711: 1 bedroom, 1 bath, 667 square feet

• Sold in September 2007 for $204,138
• Currently listed for $249,000 (parking included)
• W/D in the unit
• Sheldon Good Brokerage has the listing

Rents start at $1250 a month (including the parking) for the smaller one bedrooms.

Catalpa Gardens at 1122 W. Catalpa [website]

With the Vetro, Burnham Pointe, Printers Corner and Library Tower all slated to be closing within the next year (or, in the case of the Vetro and Printers Corner, closing right now), I thought we should look at the last “new” tower to be built in the South Loop/Printers Row neighborhood.

Wells Street Tower at 701 S. Wells was the first new high rise to be built near Printers Row in, well, forever.  I was living in a loft in Printers Row at the time and the neighborhood was giddy with excitement.  Many of my neighbors were foresaking loft living and buying units in Wells Street Tower for the views (if you were up high enough you had lake views to the east) and for the amenities- namely PARKING.

The building wasn’t built as “luxury”.  It was just an affordable, but nice, product for 20 and 30 somethings.  The building closed in 2002 and yes, there were “investors” in the building. 

In recent years, there has been some price appreciation but not what you would have imagined given the housing boom.  In some cases, owners appear to be losing money on their units.

Unit #1505: 2 bedroom, 2 bath,  1300 square feet

• Sold in May 2002 for $299,000
• Sold in December 2004 for $314,000
• Currently listed for $305,000 (with parking $35,000 extra)
• Assessments of $555 a month
• Keller Williams – West Loop Office has the listing

Unit #1505 has been for sale for months with several price reductions.  $305,000 seems pretty darn cheap for a true 2/2 in that location (must be at least $100,000 cheaper than the new 2/2s in the Vetro) but still no one is biting. 

There are several other units also for sale including:

Unit #2603: 3 bedroom, 2.5 bath, 1665 square feet

• Sold in January 2004 for $444,900
• Sold in April 2007 for $490,000
• Currently listed for $520,000
• Assessments of $791 a month
• Keller Williams -West Loop Office has the listing

Unit #2002: 2 bedrooms, 2 baths, 1275 square feet

• Sold in August 2003 for $281,000
• Currently listed for $370,900

Unit #2802: 2 bedrooms, 2 baths, 1275 square feet

• Sold in June 2003 for $300,000
• Currently listed for $389,000

Everyone wants new, new, new.  Even a building that is only two years old, is apparently too “old” for some buyers (as tastes in kitchen and baths can change that quickly.)

But what about a building that is 8 years old?

The Bristol at 57 E. Delaware was the epitome of luxury when it opened in 2000.  It has a great location right in the middle of the Gold Coast and the Rush Street corridor.  The units are spacious, with great views, and the building has nice amenities, including a lovely indoor pool.  It has 178 units.

Unfortunately, several years ago, a developer announced plans for a high rise at 50 E. Chestnut that would be directly south of The Bristol.   All units on the south side of The Bristol faced having their views completely blocked.

When a new building is going in next door, you usually see prices drop as buyers are fearful of purchasing (due to the “unknown.”)  But once a building is built, it doesn’t seem so scary.

50 E. Chestnut is slated to begin occupancy in about six months.  Any buyer in The Bristol today will have a full view into how badly their views will be blocked.

But even with 50 E. Chestnut now built, units in The Bristol are struggling to hold their value and many are selling for less than what owners paid for them several years ago.  Even some long time owners (5 years or more) are going to be lucky to make money (even in the units that aren’t blocked.)

What’s gone wrong at The Bristol? 

It’s a very nice building.  It has large units with large bedrooms and baths.  No skimping on the master bedroom in this building- with it running 16 x 17 in many units.  Yes, some of the kitchens now need updating (gasp- white appliances).  But even those owners who updated aren’t seeing any appreciation.

Is it just too difficult, even with a remodel, to compete with the glut of new units also on the market?

Here are some examples of slow to nil price appreciation (or depreciation):

Unit #3605: 3 bedroom, 2 baths, 1885 square feet

• Sold in November 2000 for $910,000
• Sold in March 2002 for $1,045,000
• Currently listed for $1,195,000
• Assessment of $1324 a month
• Remodeled kitchen
• Chezi Rafaeli at Coldwell Banker has the listing

Unit #3102: 3 bedroom, 2 baths, 2015 square feet

• Sold in November 2001 for $1,137,500
• Currently listed for $1,070,000
• Southeast view
• Assessment of $1339 a month
• Remodeled kitchen with stainless steel and wine bar
• The Habitat Company has the listing

Unit #1505: 3 bedroom, 2.5 baths, 1975 square feet

• Sold in June 2001 for $745,000
• Currently listed for $850,000
• “Sunset and neighborhood views”
• Estate Properties has the listing

Unit #2906: 2 bedroom, 2 baths, 1500 square feet

• Sold in June 2000 for $626,000
• Currently listed for $689,000
• Assessments of $868 a month
• Koenig &  Strey has the listing

Unit #1103: 2 bedroom, 2 bath,  1500 square feet

• Sold in March 2002 for $535,000
• Sold in April 2005 for $599,000
• Sold in December 2006 for $575,000
• Currently listed for $650,000
• Northeast corner
• Koenig & Strey has the listing

Unit #1401: 1 bedroom, 1.5 baths, 1050 square feet

• Sold in May 2003 for $420,000
• Currently listed for $434,900 (just had a price reduction)
• It appears that the unit looks at least partially into 50 E. Chestnut
• Susan Nick at Sudler Sotheby’s has the listing

I didn’t pick and choose here.  I found several other units on the market where the owners are also struggling to make a profit.

We’ve recently been discussing all of the foreign buyers who are (or might want to be) scooping down to buy up Chicago downtown condos.

It would make sense, right?  For the European investor, our condos are 50% off.  For the British investor, it’s an even better deal.

Perhaps, these buyers will help prop up the Chicago condo market and prevent price declines.

My question is: Are any of you agents out there actually seeing any foreign buyers?

Because I’m not seeing any foreign buyers on this site.  I use an analytic tracker which tells me the countries that my visitors are coming from.  Crib Chatter has been active about 3 months now.

Here is the data from my visitors:

• 4,537 visits from people in the United States
• 23 visits from Canada
• 22 visits from Australia
• 8 visits from the United Kingdom
• 2 visits from Germany
• 2 visits from Japan
• 2 visits from Ireland

More people living in Cicero have found this site than all of Europe.

This is non-scientific, of course.  Maybe foreign buyers don’t go on Google and do a search to find out information about a building before they buy there.  So they aren’t ending up  on Crib Chatter.  Maybe they don’t do any on-line research before plunking down their money.

But I doubt it.

To me, it seems, the Europeans and Asians don’t seem too interested in finding out about Chicago real estate.

Anyone else with different observations?  Has anyone actually encountered the “foreign buyer” with their own eyes?