After conversion to apartments, Edgewater Beach building sells for $43M

A condo-to-apartment conversion in Edgewater Beach is paying off for Greenstone Property Group.

Three years after purchasing the 188-unit lakefront building at 5815 North Sheridan Road for $27.2 million, the Brooklyn-based investor has sold the property to TLC Management, a Chicago-based apartment landlord, for $43 million, according to Crain’s. The sale completes one of the largest condo-to-apartment conversions in Chicago to date.

Aiming to capitalize on the strong rental market amid sluggish condo sales, the firm bought all the condos in the 12-story building in 2018, paying just under $145,000 per unit. Greenstone invested a further $5 million in improvements after purchasing the property, according to Crain’s.

The project followed similar condo-to-rental conversions in Lakeview, the Gold Coast, Lincoln Park and South Loop. Such deconversions can be difficult, as at least 85 percent of the owners in a condo building must be convinced to approve a bulk sale of the property under an ordinance passed by the Chicago City Council two years ago to slow the deconversion wave.

TLC’s $43 million purchase of the building works out to $228,700 per unit, and it plans to invest an additional $5 million in renovations to the building’s lobby, fitness center and about 40 apartments, according to Crain’s.

Another amenity residents will enjoy is a private beach. It’s the only apartment building north of downtown up to Loyola University with such a perk, Stuart Handler, CEO of TLC, told Crain’s.

With the acquisition of the Sheridan building, TLC has more than 5,500 apartment units in its Illinois portfolio, including properties in Evanston, St. Charles and Bloomingdale.

[Crain’s] — Connie Kim