Condominium deconversions may still have legs in the Chicago area.
Local multifamily brokerage Kiser Group recently brokered two small deconversions in suburban Oak Park for a combined $12.4 million.
Hadar Goldman’s Chicago-based firm Goldman Investments bought Regency Terrace Condominiums, a 56-unit building located at 922 North Boulevard, from the Regency Terrace Condominium Association for just over $8.8 million. Redpoint Capital Management picked up Clarence Court, a 26-unit condo building located at 628 Harrison Street, from the Clarence Court Condominium Association for $3.6 million.
More than 80 percent of condo owners approved of the Regency Terrace Condominiums deconversion, according to Kiser Group.
This fall, the city of Chicago upped its condo deconversion requirement to 85 percent of owners in to approve a bulk sale. Other Illinois municipalities, including Oak Park, are still subject to the statewide threshold of 75 percent.
As the demand for rentals skyrocketed, condo deconversions in Chicago peaked between 2016 and 2018. The market had started to slow before City Council boosted the requirement and with the change it was only expected to get more difficult for investors to get condo owners to sell.
Chicago’s largest condo deconversion closed in December when ESG Kullen purchased a 391-unit building at 1400 North Lake Shore Drive for $107 million. The condo owner vote took place in 2018, before the rule change, but did surpass the 85 percent threshold nonetheless.
Kiser brokers Andy Friedman and Matt Halper represented the condo associations in both of the deals, as well as the buyer, Redpoint Capital Management, in the Clarence Court transaction. Kiser broker Marco Cesario represented the buyer, Goldman Investments, in the Regency Terrace deal.