In a pivot from recent office purchases, the founders of downtown Chicago office brokerage Bradford Allen are pursuing local new multifamily assets instead.
An LLC controlled by Laurence Elbaum and Jeffrey Bernstein, who started Bradford Allen together in 2003, bought a freshly built Uptown apartment complex, one of two recent deals involving North Side multifamily properties both old and brand new totaling $21 million that shows investors’ unwavering desire for midmarket Chicago properties of any age.
For the Bradford Allen venture, the $11.4 million deal for the four-story, 25-unit redevelopment of 4410 North Clark Street marks a changeup in the asset class on which it’s focused acquisitions. The brokerage’s property investment division, BA Investment Advisors, in August was reported to be under contract for a $40 million purchase of the 11-story suburban office building called Pointe O’Hare at 9550 W. Higgins Road in Rosemont.
In the last two years, it had already spent $80 million since for office properties in Downers Grove, Deerfield and Northbrook, despite suburban Chicago office vacancy reaching new record highs amid the pandemic. Plus, the brokerage’s investment division in August also spent $70 million to buy a 700,000-square-foot building in Jacksonville, Florida.
MCZ Development built the North Side property, as a redevelopment of the former Uptown Fitness building.
While it’s a transition of sorts from the recent acquisitions made by the Bradford Allen venture, the firm’s founders are familiar with new development projects, as well. Bernstein has been pursuing a mixed-use development of Chicago’s northwest suburbs along Higgins and Arlington Heights roads that involves turning the former Daily Herald newspaper building into medical offices, an aspect of the project he received approval for earlier this year.
Neither Bradford Allen nor MCZ Development returned requests for comment on the deal, which was recorded in Cook County public records last month.
In another deal for $10.5 million that shows Chicago’s midmarket multifamily demand remains strong from investors despite a downturn in investment sales, Altitude Capital Partners bought a historic property in Streeterville. It’s a 13-story, 25-unit property built in 1956 at 227 East Walton Place, and was designated a Chicago landmark in 2012.
“Even in the midst of interest rate uncertainties, this deal illustrates the high demand for well-located assets,” Marcus & Millichap’s Kyle Stengle, who represented seller Brad Management in the Streeterville deal, said in a statement.
The deals were struck as rising interest rates pose continued threats to Chicago’s multifamily market. Still, the asset class maintained momentum in the third quarter, with sales activity matching pre-pandemic records set in 2015 and 2019, according to a quarterly report from Marcus & Millichap. The report also singled out the Uptown and Wrigleyville neighborhoods as high-demand areas, with 3.8 percent vacancy.
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