Another multifamily property in the West Loop sold at a discount.
JLL Income Property Trust recently sold its 28-story apartment building at 180 North Jefferson Street for $76.3 million, Crain’s reported. The price was 20 percent less than the $96.4 million it paid for the building in 2016. The 274-unit building sold for $278,000 per unit.
The buyer was Milbourne Capital LLC, a group of private investors based in Chicago. CBRE’s John Jaeger, Justin Puppi and Jason Zyck represented JLL’s investment arm in the transaction.
The building is more than 97 percent occupied with an average asking rent of $2,544, or about $3.32 per square foot.
“Throughout our hold period, this investment maintained a high level of occupancy and generated significant net operating income for our fund,” said Allan Swaringen, JLL Income Property Trust’s president and CEO.
High demand for rentals in the West Loop is pushing rents upward, but high interest rates and economic uncertainties have made it more difficult for investors to sell properties at favorable prices.
The sale marks the second recent transaction in Chicago where a high-profile multifamily property sold at a loss, following the sale of the Parker apartments in Fulton Market.
The sale was part of JLL Income Property Trust’s long-term strategy to reinvest in suburban apartment buildings, Swaringen said. The firm’s residential portfolio, valued at $2.6 billion, includes 25 apartment complexes and more than 4,500 single-family rentals.
“There remains strong institutional interest in higher-quality multifamily properties,” Swaringen said. “This sale increases our available capital to reinvest in higher yielding properties that we believe will improve future cash flows and point forward returns.”
Meanwhile, the West Loop continues to see interest from developers, including
Also in the West Loop, MZ Capital Partners Is buying The Jax, developed by LG Development and AEW Capital.
Additionally, developer Fern Hill has shifted its Free Market development in the West Loop from condos to rentals, reflecting changing market demand. The project will now feature 120 rental units and 9,000 square feet of retail space.
— Andrew Terrell
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