Apartment developers are crazy for the Chicago suburbs

New analysis projects 3,500 new residential units by the end of the year

Nov.November 25, 2019 12:01 PM
1450 Sherman Avenue in Evanston, the site of a 273-unit project (Credit: City of Evanston)

1450 Sherman Avenue in Evanston, the site of a 273-unit project (Credit: City of Evanston)

You don’t have to travel far to find a market that rivals the apartment boom in downtown Chicago.

This year, developers are on track to complete about 3,500 apartment units in the Chicago suburbs, just 300 fewer units than are expected to be delivered in the city of Chicago before the calendar turns.

It’s the biggest annual total since at least 1996, when Ron DeVries, senior managing director of Integra Realty Resources, started tracking suburban development. A year ago, the firm projected about 3,000 units would come online in 2019.

The expanding job market is driving the demand for housing, and many people are choosing to rent instead of own, Crain’s reported. Plus, young professionals who work in the suburbs can get more for their money in towns like Evanston and Oak Park than they could in Chicago.

Additionally, the suburban market is increasingly catering to move-down renters, with developers building lavish, condo-style projects targeted toward empty nesters who sell their single-family homes after their children move out.

Suburbs with big downtowns give renters easy access to restaurants and shops, and projects near train stations have been top of mind for developers.

Since 2015, the most active suburbs for apartment development have been Evanston, where 1,079 units have been completed, follow up Oak Park with 1,056 units, according to Integra.

Though the suburban apartment market has seen a lot of growth in recent years, it’s been fairly slow and steady, especially compared to the Downtown development frenzy. The average rent for a typical 900-square-foot apartment in the suburbs is $1,332 per month, up from $963 at the beginning of 2010.

Overbuilding and oversaturation shouldn’t be an issue in suburban Chicago despite the activity given its vastness and adequate spacing between new supply, Crain’s reported.

More than 13,000 additional units are in the works in the suburbs, but DeVries expects completions to fall to about 2,500 apartments next year due to rising construction costs, uncertainty surrounding property taxes and Illinois’ precarious fiscal condition, all of which could further curb development. [Crain’s] — Brianna Kelly

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