Hines Sets Record for Suburban Chicago Multifamily Price

Hines has raised the bar for suburban Chicago.

The Houston-based real estate giant paid $148 million to buy the E2 apartments in Evanston, setting the record for the priciest multifamily deal ever in the suburbs, according to public records.

Milwaukee-based Northwestern Mutual was the seller of the property, which consists of two 16-story towers with 352 units at 1890 Maple Avenue. The price comes to $420,500 per unit.

The deal beat the previous apartments record for suburban Chicago, set by Oak Brook-based Albion Residential with its nearly $140 million purchase in 2022 of the 612-unit Bourbon Square apartment complex in Palatine. That deal cost $228,800 per unit.

Hines’ pickup at the record price point underscores the scorching demand for rentals in Evanston, home to Northwestern University and an apartment market that has drawn multiple largescale proposals of late. Plus, the Evanston City Council is in the midst of considering updating zoning for single-family swaths of the city to allow the construction of more multifamily buildings of four units or less.

Among the big apartment developments being eyed in Evanston are GW Properties’ 27-story proposal for 900 North Clark Street, as well as Vermilion’s 31-story proposal for 605 Davis Street, a building that would become the suburb’s tallest. Both are still moving through city channels for approval.

It’s not clear how or whether Hines financed the deal, as it hasn’t yet recorded a mortgage on the property, meaning it could have paid cash. It appears that Hines purchased the property through a Delaware Statutory Trust, which allows investors to put money into deals and own fractional interests of buildings without managing them, so Hines may have investment partners in the deal.

Hines immediately offer comment Thursday morning, and Northwestern Mutual declined to comment.

Northwestern Mutual co-developed the building with Chicago-based Fifield, completing its construction in 2015. The life insurance company bought out Fifield’s interest in the property about six years ago.

Although it’s unclear how the parties valued the property at the time of the buyout, the development has been considered Evanston’s priciest in terms of rents, with three-bedrooms fetching upwards of $6,000 at the time it was listed for sale with JLL. Average rents in the property exceeded $4,000.

Furthermore, Hines’ purchase ends a fairly lengthy marketing process for the seller. Northwestern Mutual first hired JLL to market the property while it was 99 percent occupied in early 2023.

Since then, the suburban apartment market has largely outperformed downtown Chicago’s, where several sellers have taken some painful losses in value when exiting multifamily investments made before interest rates jumped in 2022 and ate into property values.

While sellers in the city may not have fetched the peak prices of several years ago, the Midwest, and the Chicago area in particular, has been considered a good bet by buyers of late due to nation-leading rent growth, especially in the suburbs, as Sun Belt markets grapple with a glut of supply developers have built in recent years.

Elsewhere in Evanston, John O’Donnell’s Chicago-based development firm Riverside Investment & Development is seeking to cash out of a multifamily project, as well. In August, the firm listed The Main, a 112-unit property at 847 Chicago Avenue, with brokerage CBRE.