Jeffrey Jaeger’s affordable housing landlord Standard Communities has paid about $43 million for a South Side apartment complex that transfers a chunk of the property out of the Chicago Housing Authority’s portfolio.
Standard will keep affordable housing restrictions on about three-fourths of the units at the 148-unit Lake Park Crescent complex at 1061 East 41st Place in the Oakland neighborhood for at least another 30 years. The developer also is committing another $10.6 million to renovating the apartments.
The property includes 36 unrestricted market-rate units and 112 affordable units, with qualifying incomes ranging from 40 percent to 80 percent of the Area Median Income. As part of the deal the Chicago Housing Authority had 60 residential units converted to a program where affordability is maintained by Project Based Vouchers. The federal program allows public housing providers such as the Chicago Housing Authority to ensure long-term affordability of units that require rehabilitation and private financial backing.
In terms of per-unit acquisition costs, Standard paid $290,000, a premium over other recent South Side trades involving affordable housing even before the $72,000 per unit it will spend on renovations. Some recent deals for apartment complexes that are 100 percent affordable–including a couple of acquisitions by Jonathan Rose–have come in below $100,000 per unit in other South Side neighborhoods. The difference on Standard’s deal points to the value of the 36 market-rate units at Lake Park Crescent.
Standard expects to pursue more investment and development opportunities in Chicago’s affordable multifamily market, the company said. Standard obtained financing for the transaction and renovation through low-income housing tax credits provided by Boston Financial Investment Management, and additional financing was provided by Citibank, the landlord said.
Based in New York and Los Angeles, Standard owns 14,100 apartment units and has completed more than $3.8 billion of affordable housing acquisitions and rehabilitations nationwide, according to the company.
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