Crescent Heights won’t be developing another high-rise next to Chicago’s tallest apartment building, but maybe another developer will.
The Miami-based firm has hired CBRE vice president Tom Svoboda to sell the 43,100-square-foot parcel at 1201 South Michigan Avenue near Grand Park, roughly four years after building the 76-story Nema Chicago apartment complex on the adjacent lot, Crain’s reported.
No asking price has been revealed for the vacant site, but it could get scooped up fast given the high apartment demand in Chicago, especially in the downtown area. High rents and strong occupancy rates have bolstered a multifamily sector that’s been a bright spot in Chicago real estate, as the city’s office and retail sectors struggle to recover from the pandemic.
Developers are running rampant with new apartment projects, but it’s possible that they become overzealous, putting the balance of supply and demand out of whack. Approximately 3,700 multifamily units are slated to be delivered downtown in 2024, which would be the most since 2017. Too many units could lead to a considerable drop in occupancy, rents and property values.
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It’s unclear what the future holds for 1201 South Michigan, but its current zoning would allow for a skyscraper rising up to 900 feet — almost as tall as the 800-unit Nema. CBRE is marketing the site as a rare opportunity to build an apartment high-rise overlooking Grant Park, while also emphasizing Nema’s strong performance since opening in 2019. The lot is also big enough that two towers aren’t out of the question.
Crescent Heights remains one of the most active real estate players in the Windy City’s downtown multifamily game. In February, the firm purchased a 1.7-acre site in the Fulton Market District for $34.5 million. There, it’s planning a 52-story, 587-unit building that would be the tallest high-rise in the neighborhood.
Crescent Heights also turned heads in June when it paid $173 million for a 400-unit tower in Streeterville, marking the priciest multifamily deal this year in Chicago.
— Quinn Donoghue