A Streeterville apartment complex is up for grabs, and if its fate is similar to other nearby apartments, it could trade for far less than what the sellers invested in the property.
Chicago-based Jupiter Realty and an affiliate of MetLife have hired JLL brokers Kevin Girard, Mark Stern, Zach Kaufman and Jason Zyck to market the 48-story, 444-unit luxury tower at 465 North Park Drive, CoStar reported.
The apartment high-rise was completed in 2018. It’s unclear what the development costs were, but a sale would come amid a rough market for the Jupiter-MetLife venture, as rising interest rates continue to push property values down across the city and threaten landlords.
The 400-unit complex at 340 East North Water Street, next door to 465 North Park, sold for $173 million in June. That’s the priciest multifamily deal so far this year in Chicago, but significantly less than the $240 million Invesco paid for the asset in 2016 when it last traded. Also in Streeterville, the 17-story building at 200 East Chestnut Street sold for $55 million last month, equating to a $20 million loss for the seller.
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Hiked interest rates, a tight lending climate and overall pessimism surrounding Chicago real estate have hindered multifamily deals in 2023. This year, investors have spent $1.9 billion on multifamily assets, the outlet reported, citing CoStar data. A total of $5.6 billion was spent on such properties in 2022.
With 465 North Park 93 percent leased, its rents range from roughly $2,000 to $7,000 per month, according to the apartment’s website. While JLL mentioned the availability of “free and clear financing” in its marketing materials, it’s unclear what type of financing is being offered as part of the sale.
The prospect of seller financing attracts some buyers in today’s rising interest rate market, and can boost the values of deals.
— Quinn Donoghue