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Chicago

Strategic Properties rescues record Chicago condo deconversion

Yitzy Klor’s firm progresses on $190M deal that was jeopardized by interest rates

Attorney Howard Dakoff with 10 East Ontario Street (Levenfeld Pearlstein, Google Maps)
Attorney Howard Dakoff with 10 East Ontario Street (Levenfeld Pearlstein, Google Maps)

Chicago’s biggest condo-to-apartments deal has been resurrected after it took a step toward the graveyard due to rising interest rates.

Yitzy Klor’s Strategic Properties of North America is set to buy out the owners of all 467 condo units in the 51-story Ontario Place building in River North for $190 million, Crain’s reported. The deal is picking back up after SPNA’s financing for the purchase fell through in August.

The landlord’s attorney, Howard Dakoff, said the deal for the property at 10 East Ontario Street in River North will be finalized on Feb. 15.

The $190 million deal will be the highest price ever paid for a residential condo building in Chicago, beating out the former record holder, a Gold Coast condo building that sold to ESG Kullen for $107 million in 2019.

SPNA previously tried to buy out Ontario Place in 2020, but had to revise its offerings to get more condo owners to agree to the deal. Under a Chicago ordinance, at least 85 percent of the owners in a condo building have to agree to sell for a deconversion project to move forward. By 2021, SPNA had the support of almost 90 percent of the condo owners.

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The developer had to delay the deal during the fall due to financing problems. The board agreed to extend the deadline for the buyout until SPNA could secure financing.

Some condo owners in the building aren’t in favor of the deal and are working to stop SPNA’s plans from moving forward. Julius Cherry and Gerald Glazer are among the residents who have filed a lawsuit against the developer, claiming the condo association’s board improperly handled Strategic Properties’ offers and illegally extended a voting period to get approval after a previous attempt failed.

The courts supported the condo board’s decision and the owners trying to stop the deal haven’t been able to get a judge to side with them so far, though litigation over the matter is still proceeding through a California court.

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— Victoria Pruitt

Tags
Condo DeconversionsCondo MarketRiver NorthStrategic Properties Of North America