Chicago’s multifamily market is facing a test, as a pair of River North apartment towers hit the market.
Magellan Development Group has hired CBRE brokers to sell the 442-unit Gallery on Wells, at 637 North Wells Street, and the 298-unit Exhibit on Superior, at 165 West Superior Street, CoStar reported.
Magellan, led by CEO David Carlins, developed the apartment buildings six years ago. It’s unclear how much the firm expects to make in a sale, but Magellan remains bullish on Chicago.
“When we look around the country, we see the steady growth in Chicago as a positive,” Carlins told the outlet. “We want to do more in Chicago.”
The 39-story Gallery on Wells is just over 90 percent leased, and the 34-story Exhibit on Superior has a 94.6 occupancy rate. Average monthly rents are about $2,700.
Chicago’s multifamily market is bursting at the seams, leading the nation in rental growth for three straight quarters, the outlet reported. Yet, this year’s sales volume of $3.2 billion is down considerably from the past two years, when it was closer to $5 billion.
The largest multifamily deals of 2023 are Spanish billionaire Amancio Ortega’s $232 million purchase of a West Loop apartment complex, and Crescent Heights’ $173 million acquisition of a Streeterville apartment tower.
Crescent Heights is also testing the market, recently putting the 76-story, 800-unit NEMA Chicago tower on the market. Elsewhere in River North, Berkshire Residential is looking to sell the 292-unit Eight O Five building at 805 North LaSalle Street.
Magellan’s Chicago portfolio includes the sprawling 28-acre Lakeshore East project, which encompasses the iconic 101-story St. Regis Chicago. In the early part of the pandemic, the firm collaborated with Sterling Bay to build a 47-story apartment and hotel tower at 300 North Michigan Avenue.
—Quinn Donoghue
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