Sealed Bid Event for a Townhouse in the Sky: 33 W. Ontario
We last chattered about this unfinished “townhouse in the sky” at 33 W. Ontario in River North in February.
See our prior chatter and pictures here.
It has since been reduced by $200,000.
But this week, you can participate in a sealed bid event.
The event is being held on June 4 from 4 pm to 8 pm (with wine and cheese served). However, the seller will be accepting bids anytime up to the close of the event.
Will this unusual marketing technique work to get buyers in the door?
Lindsey Delrahim at Jameson Real Estate still has the listing. See more pictures and a virtual tour here.
Unit #TH3: 4200 square feet, tri-level, unfinished space
- Sold in July 2007 for $1,050,000
- Was listed in February 2009 for $1,099,000 (2 parking spaces included)
- Reduced
- Currently listed at $899,900 (2 parking spaces included)
- Assessments of $1704 a month
- Taxes are “new”
- Private elevator to the townhouse
I sold a finished corner unit in October for 2.35m. This range seems like a fair price for the raw space. The assesments seem high but comp them with any 4000sf unit and you will see they are average fir a unit of this size.
“Private elevator to the townhouse”
Actually private, as in you have to pay all of the maintenance expense, or private as in servicing all the THs, but not the tower?
Has anyone been able to get access to Jameson site for more info on this unit? I cannot seem to navigate to it.
A close relative in the same business as I ‘rescued’ three uber high dollar units in Miami highrises when the RE collapse first started there a few years ago. The developer simply ran out of money after the walls went up leaving great opportunities for those with the available cash and know how to turn them into spectacular places. Of the three, they kept one for their primary residence and it has been a rough go for them as the other units in the building remained unsold and unfinished for a long time. Only within the last few months has it made sense to do what they did.
Unless one has the cash for the total purchase price and massive buildout $$$$ without relying on a bank loan, indepth construction/design knowledge and a ton of experience in taking over and finishing places like this it is not worth the many problems one would face in converting the unit into a livable (if not profitable) space. Def not a project for a regular buyer.
That said, I think this could end up being a spectacular place. I do not see any resale opps for many years to come, so one would make this their primary residence. Dream house? Sure it could be for the right person. I hope whoever has the motivation and deep, deep pockets to get involved in this project realizes what exactly they are getting into…
Not a very good view for that kind of $$$$
Overlooking Grand Plaza + the Embassy Suites + those !@(#-tty Magellan Developments is pretty lame for a “dream” place.
Lots of good properties available from $1MM to $2MM. YMMV.
Out of curiousity, if this building were cleared of any other problems (Invesco, short sales and foreclosures) what would you all consider to be a fair price for the purchase of this 4200 sf unit? Without knowing how extensive the work load would be to complete this “could be incredible” place, I would roughly estimate the finishing cost would be around $500k…for quality planning, work and materials, or basically half of the current asking price…or if you went all out, it could easily surpass the purchase price. Looking at high end finished units in the area, it would seem the end unit ‘could’ list for around $2-3.5 million…that of course being without the gloomy problems involved.
Not a great view, maybe, but some awesome natural lighting and outdoor space. For that size of a space, in that location, with that outdoor space, I think they can move it at this price. Unless there is something about the building we don’t know about…
“Looking at high end finished units in the area, it would seem the end unit ‘could’ list for around $2-3.5 million…”
The problem in this sentence is the word “list”. Sure there might be ‘comps’ that are listed in that range. But real comps only exist from closed sales and I think you’ll be hard pressed to find any of those in the last 6 months (or even year).
The bottom line is with essentially no sales volume in the high end condo market we have no idea what the price is for a unit like this. Probably somewhere north of a $1MM (once well built out) but you can’t really say for sure since there isn’t any market.
Listing ;comps’ are pretty much worthless in this market. Show me the money (i.e. the actual closed sales) in the last 6 months and I’ll tell you what it is worth. If there aren’t any sales then there isn’t a market and you can book the value at whatever you want but as any bank will tell you right now, illiquid assets suck.
How much can an HOA legally increase it’s dues to make up for all the distressed units that aren’t making monthly payments? Obviously anyone that can really afford a 7 figure penthouse isn’t worried about increases in dues. What about an average person owning a 2 BD in an Ivsco building?
Alrighty then kp…
I know what you are saying, no comprehension problems there. What I am saying is, once we ‘hit bottom’ (and there are indications that we are at or very close to now) and start to see sales in the upper end market, where do you place the value of this built out unit then?
Looking through B&W’s luxury section, there are many high end units that are offered. Are they selling at their prices? Of course in this market they are not. But that does not stop sellers from pricing their property at an amount ‘they’ (and their overzealous agents) determine they are worth.
So that is my question. If you bought this place, built it out in a mid to high end way, where would YOU price your house at? Just play along and assume the market regains the steam it lost and pretend this all never happened!! Come on now, have fun with it!! I realize most posters here are not in the market for something like this, but as I said, just play along with me.
it would really cost a half mil to build this out nice? how does that brake down b/c it sounds like an awful lot to me. granted, i’m oblivious.
Westloopelo.
Alright, I’ll play this game.
Location is pretty good but you aren’t getting any amazing views (or really views period). 2 parking spaces should be a given for anything in this price range.
Assuming that you build it out right (i.e. real luxury finishing, not just faux condo luxury) I think that you could estimate that you could get it to be ‘worth’ close to $400/sqft, maybe even a smidge more. I still think, that even if we are hitting a bottom and getting movement in the luxury space (which we are assuming for the sake of the game) nothing much in Chicago should be over $400 sqft unless you’ve got perfect views and location because of the costs of jumbo’s and the mess that is the conforming loan limit.
4000 sq feet at $400 is $1.6MM. If you could get the raw space for $800k I think you’d need at least $600k to do the inside right. Then you’d be looking at at least $1.4MM in. No great deal. But by doing the renovation yourself you might not be under water when you finish if there is a luxury housing market and you ignore all of the problems that is the innvesco name. That long will hurt your comps in the future (as compared to if you used $1.5MM – $2MM to buy a SFH in Lincoln Park or Southport).
To answer CH, about how does it get that high. Assuming you don’t do anything your self you are looking for a property like this to drop at least $100k (if not more) into the kitchen alone since you’ve got nothing, and at least that much into three full and two half baths. You’ve got no flooring and good hard wood ain’t cheap for that 4000 sq ft. It all adds up pretty fast.
I sold the end unit in this complex for 2.35 million last October. For photos check out http://www.skyhome33.com.
This is the best comp for a completed value. FYI this owner put over 1 million into the buildout. It is expensive to do it right, at least $200/sf.
I will say I like the way that the end unit turned out. A million in the build out doesn’t shock me at all since I was playing pretty fast and loose with my $600k guess.
Matt, I assume that the end unit has much better light and (maybe even some views?) compared to this one?
Matt, what firm/contractor was use to do the interior design for that end unit?
Matt,
very impressive website/townhouse. out of curiosity, how much would it cost to do something similar (i.e. similar level of finishes) to this townhouse?
The end unit does have almost 2x the sunlight exposure. I would place a 10-15% premium on this.
This was a very, very high end buildout, in the 200/sf range. I think you could get it done with slightly less expensive finishes in the 150/sf range.
Those who think “residential market will soon hit bottom” should consider ever increasing unemployment rate and rapidly increasing prime mortgage defaults. Number of residential units for sale, whether 1 bedrm condos or $1 million houses, is significant for each residential product type and neighborhood. More people yet will be compelled to sell, because of unemployment, under employment, relocation requirements, bankrupcy, credit card debt, outstanding HELO obligations, etc. Net sale prices (often asking prices still reflect owners’ wishful thinking) will continue to decline for foreseeable future for probably all product types.
Calling the bottom from a macro perspective is foolish. Even if prices continue to go down on average, it doesnt mean you can’t beat the average if you are a buyer and get a good deal now. Volume is starting to go back up as prices come down. If you want to see the most honest assessment you will ever see from someone in this business, check out my Bloomber interview from Dedember:
http://www.youtube.com/watch?v=Z6MIq7cbqcg
“Rents need to come up” to help the rent:buy equation? Any economic reason for this to occur in the current environment, or is it just hope?
I am not saying it is going to happen, I am just saying it is what needs to happen for prices to come up.
Matt — So if rents aren’t going up, and appreciation is hinged on rent/buy parity ….. why is it a good time to buy?
Are prices low enough to warrant taking on the risk of an illiquid asset with limited growth potential?
John
Don’t worry. Rents will be going up real fast once hyper-inflation sets in.
If I knew what was going to happen I would be running a hedge fund. But the best answer I have is whether or not it makes sense to buy is best decided on a case by case basis. Your situation, market, neighborhood, building, unit etc. If I know all those variables I can make an educated guess.
“Are prices low enough to warrant taking on the risk of an illiquid asset with limited growth potential?”
All depends on the transaction. I just saw a foreclosure go under contract for mid-300s: probably needs 50k of work (I’m no builder but thats my guess). Sold for upper 600s a couple years ago and mid 500s a couple years before that.
I have looked at the space twice. The price is more than fair. the only finished unit to sell closed at $2.5M and was very well done. You will need upwards of $700k to finish the unit. There are no openings in the floors for stair or elevators. No plumbing or electric. Figure $170-250/ft to finish out, IF you general it yourself.
Also got a peak at another finished unit. Drop dead beautiful! Not too many places in the city you are able to get this type of space at this price.
Having lived right in this neighborhood, all I can say is that this unit is down the street from the fire station and Dearborn is the fire engine route with especially loud horn blaring at Ohio and Ontario. These units are not that high up….let’s hope that they have extra money for some sound proofing!
I have showed this building a couple of times, I like this building, the units are large and there are lots of sun light in the units. The location is very nice too, lots of restaurants and walking distance to Michigan Ave. I know the problem of this building was during the conversion, lots of people bought with no money but with good program and now the program is ended and they do not have anything to pay the added up charges. But I know the building is sold, so if you have cash, why not get one unit there.
check out the fraud about this property:
http://www.chicagorealestatedaily.com/cgi-bin/news.pl?id=34523