Randolph Street Realty Sells Suburban Chicago Apartments

Randolph Street Realty Capital rounded out the year with another suburban Chicago multifamily deal.

The Chicago-based firm sold the Deer Valley Apartments in the North Chicago suburb of Lake Bluff for $38 million, after spending $31 million to buy the property in 2017.

The end-of-year sale of the 224-unit complex comes out to $169,000 per unit, up from $138,000 per unit when it last sold. After purchasing the apartments seven years ago, Randolph Street renovated the club house and pool area, according to a post on its website, although it’s unclear how much it spent on the improvements.

A representative of Randolph Street declined to comment. The firm bought the property with investor David Young and members of the Scheck family, who are originally from Illinois.

The buyer is a venture that includes Chicago-based Marquette Companies and Ullico, an insurance and investment firm that serves labor unions, Lake County property records show. Marquette Companies and Ullico did not respond to requests for comment.

Although property taxes and high interest rates can cut into profit margins, multifamily properties in the Chicago suburbs have generally fared better than their counterparts in the urban core.

Steady rent growth and a strong job market in the city have been hampered by Cook County’s property tax regimen and political uncertainty at Chicago City Hall.

As investors vie for purchases in the suburbs, rent trends are on the upswing. Chicago’s suburbs saw the greatest demand among residential renters in the country, tied with Miami, according to a September study from RentCafe.

That doesn’t mean Chicago is too far behind. The same study put the city in fifth place among the country’s most in-demand markets for renters in the U.S.