David Gassman Sells Chicago Apartment Portfolio for $72M

Chicago investor David Gassman has cashed out on a North Side apartment portfolio that he started assembling in the early 1980s.

Gassman sold the 17-building portfolio, totalling more than 300 units, to eight buyers for $72.4 million, Crain’s reported. That comes to more than $241,000 per unit.

Essex Realty Group brokered all 15 transactions, the largest being a $23.5 million sale for a three-building, 125-unit assemblage in Rogers Park. Affiliates of Chicago-based Slater Realty & Investment paid $188,000 per unit for the properties, at 6954 North Sheridan Road, 1145-1161 West Lunt Avenue and 1224 West Morse Avenue.

The other buyers included Casey Capital, Highland Real Estate Partners, Aljack Investments and Fairmont Property Management, with transactions ranging from $1.4 million to $7.5 million.

Although high interest rates and tight lending standards have made it tough to sell commercial properties since last year, strong rental demand on the city’s North Side drew a swarm of interested investors, said Essex principal Kate Varde, who represented Gassman.

“You had high-quality properties in great locations, and I think the city has made it challenging to add new rental units,” Varde told the outlet. “The rental market’s as full as I’ve seen it. Occupancies are high, and as a result, investors have an appetite for well-located properties in Chicago.”

Other markets outside of Chicago, such as the Sun Belt, are grappling with oversupply issues after an apartment building boom in the initial years of the pandemic, pushing down rents and occupancy. Chicago’s multifamily inventory, meanwhile, has gradually increased, growing by 1 percent in 2023, compared to the national average of 2.3 percent, according to RealPage Market Analytics.

The slight rise in apartment stock has correlated to incremental rent hikes, yielding healthy profit margins for landlords, without deterring prospective tenants.

Apart from Slater Realty’s purchase, the priciest deals stemming from the portfolio were a $7.5 million sale of 4424 North Wolcott Avenue, and a $7 million purchase of 1740-1752 W. North Shore Avenue. Apartments at 900 West Montrose Avenue and 1040-1044 West School Street followed, trading for $4.9 million and $3.9 million, respectively.

The following properties also changed hands: 652 West Roscoe Street, 1738-1742 West Touhy Avenue, 4741 North Beacon Avenue, 2135 West Ainslie Street, 2548 North Burling Street, 4931 North Claremont Avenue, 6435-6455 North Newgard Avenue, 1421 West Rosemont Avenue, 3538 North Fremont Street and 4420 Nest Winchester Avenue.

—Quinn Donoghue