Urban Edge Group shelled out $5.7 million for three Lincoln Park homes in an off-market transaction earlier this month as developers look for smaller multifamily deals in a neighborhood favored for its friendly zoning policies.
The local developer plans to demolish the homes, at 1933, 1935 and 1937 North Mohawk Street, to build an eight-unit luxury condo building, said Konrad Dabrowski of Fulton Grace Realty, who represented Urban Edge in the deal. They totaled over 8,900 square feet, meaning Urban Edge snagged them for $634 per square foot. Ben Miotti of Coldwell Banker Realty represented the sellers.
The area’s flexible zoning allows medium to high-density multifamily buildings alongside smaller buildings like townhouses, two-flats, and single-family homes without the need for a costly zoning change. That makes it particularly attractive to developers like Urban Edge, said Alex Morsch of Cross Street, the other buyer’s broker on the deal.
“It’s all about zoning when it comes down to it,” Morsch said.
Small to midsize multifamily deals in areas with favorable zoning has become even more attractive for developers given the rise in construction costs, Morsch said.
The Mohawk Street deal represents the “highest and best use” for the three lots, given that Urban Edge plans to replace three single-family homes with a condo building capable of housing eight families, Morsch said.
Other teardowns in Lincoln Park over the last few years have gone in the other direction.
In 2022, high-end Chicago builder BGD&C Homes sold a mansion that combined four Lincoln Park properties for $9 million before the project was even completed. Also in 2022, Environs bought two properties, one of which was a condo building, for $4.85 million and redeveloped them into two single-family homes on Howe Street, one of which sold for $6.8 million in an off-market deal earlier this year. Last year, Savane Properties listed a mansion it developed across two lots on North Burling Street for $10 million. That home has yet to sell, according to public listing information.
Luxury buyers have increasingly been drawn to move-in ready homes and condos that require less up-keep than a large single-family home. At the same time, demand is shifting toward neighborhoods outside the city center like Lincoln Park.
Morsch said he anticipates developers will be scouring Lincoln Park for more of these kinds of off-market, small multifamily deals to take full advantage of those trends and the favorable zoning.
However, there are likely to be downsides to Lincoln Park’s flexible zoning as the neighborhood continues to see high levels of redevelopment, Morsch said.
“A lot of the neighborhood, over time, is going to lose its original character, comparing [Lincoln Park] to a Wicker Park that has strict landmark and historical status,” he said.
All three homes sold in the deal on Mohawk Street are more than 130 years old, according to the Cook County Assessor’s Office.
Two of the homes were owned by the same couple and connected by a gangway, Miotti said.
Urban Edge is still early on in its planning for the condo building, but it will feature an elevator and an indoor parking garage, Dabrowski said. Dabrowski will work with Urban Edge to list the condos through DG Advisors Group once the homes are finished, he said.
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