Third time’s a charm? Wheaton apartment complex tests market again

The Connor Group is testing the Chicagoland multifamily market again, hiring a third brokerage in two years to list its suburban apartment complex Wheaton 121. 

The Ohio-based firm bought the 306-unit property in Wheaton for $72 million ($235,000 per unit) in 2018. At the time, the firm took out a $49 million loan from CBRE’s lending arm, DuPage County records show.

In 2022, the firm listed the property with Newmark. The Connor Group later hired CBRE to list the property, in September 2023. Walker & Dunlop’s Todd Stofflet announced July 15 that the brokerage is taking on the listing. 

Connor Group bought the property from Atlanta-based Invesco, which took a big loss after paying almost $99 million for the complex in 2015.

It sold for less in part because of a large property tax increase, Crain’s reported at the time — the 2018 bill jumped 47 percent from 2016 to $2 million.

An asking price for the property, at 121 North Cross Road, has not been confirmed.

It’s unclear whether Connor Group took the listing off the market at any point over the past two years, or if it has continuously jumped from one brokerage to another. Representatives of the Connor Group declined to comment. 

While the property has been on the market, the Midwest multifamily sector has performed well nationally. 

Rent growth peaked at 7.3 percent at the beginning of 2022 and now stands at 3 percent, according to data compiled by CoStar. Meanwhile, the Sun Belt has seen rent growth plummet from an average of nearly 15 percent to -1 percent in the same period. Nationwide, rent growth currently sits at about 1 percent.

Rising interest rates, however, have hampered the success of even well-occupied buildings in Chicagoland. 

Foreclosures and loan troubles started to tick up in Chicago’s multifamily market at the beginning of the year, although it avoided the Sun Belt’s full meltdown.

This spring, more than $240 million worth of multifamily debt tied to bigtime real estate investors was under threat from lenders in Chicagoland due to floating interest rates.

In recent months, multifamily owners have continued to test the market with high-profile listings. 

In the West Loop alone, LaSalle Investment Management, PGIM Real Estate and Origin Investments are all seeking buyers for their respective properties at 180 North Jefferson, 765 West Adams and a corner of Monroe and Aberdeen streets.

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This week, Los Angeles-based JRK Property Holdings listed an 838-unit complex in Arlington Heights. It is the first time the property has hit the market in a decade. 

Of the high profile deals that have been inked in Chicago since the beginning of the year, sellers seem to have mostly been suffering losses. 

In April, J.P. Morgan Asset Management sold 850 North Lake Shore Drive for $80 million, down from the $140 million the investment vehicle paid for it in 2016. The sale price was high enough, however, to spare the property’s lender Nationwide Insurance from a loss. The lender had issued a $70 million loan for the building to J.P. Morgan.