Suburban Chicago active adult complex sells for 40% premium over 2021

Kurt Bender’s multifamily investment firm Bender Companies spent $20.5 million on a suburban Chicago housing complex targeting older adults, an asset class increasingly desirable among apartment players.

A company sharing a Chicago address with Bender bought the 173-unit Burbank Manor in the western suburbs from another local firm, Advantage Management, for 40 percent more than the property sold for a year ago, when almost all its residents were 55 and older, public records show.

The margin achieved by Advantage reflects the expanding demand for so-called active adult communities, which are geared toward residents 55 and up and have become preferred senior housing assets to assisted living, skilled nursing and independent living facilities.

Neither the buyer nor the seller returned requests for comment.

While the entire senior housing sector has been viewed by investors as better able to withstand economic downturns than other assets, active adult communities have become the most sought after within the class. Some 31 percent of respondents to a national JLL survey this spring favored them over alternatives. That portion of respondents was the largest of those who indicated the senior housing assets they viewed with the best outlooks.

Senior housing isn’t entirely recession-proof, though. Demand for such properties was softened by Covid-19, which dampened interest in congregate care facilities where the virus spread easily among high concentrations of hosts especially vulnerable to severe symptoms. Those concerns were less acute for active adult communities than senior communities offering more intensive health care regimens, and all asset types within the category have since started to rebound.

“The pandemic turned this resilience on its head, but demand has since shown improvement on a quarterly basis, with occupancy continuing its steady climb back to pre-pandemic levels,” the JLL report said.

Bender focuses on multifamily acquisitions between $5 million and $30 million of class B and C properties built 20 to 40 years ago that contain more than 100 units in the Midwest, according to the firm’s website. Burbank Manor, at 97 Pinehurst Court in suburban Burbank, consists of one- and two-bedroom units in 27 single-story buildings across six acres, and was built in 1983.

The company last year stepped above its normal price range to pick up the 672-unit New Colonies apartment community in suburban Steger for almost $70 million.

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