Chicago landlords are set up to strongarm rent hikes this year and beyond.
Leases struck within a group of 84 downtown buildings tracked by brokerage Luxury Living surpassed an average of $3,000 per month last year for the first time ever. With new supply limited by developers grappling with higher interest rates and construction costs, landlords are projected to have the upper hand until 2027, the earliest that a significant wave of rental deliveries is expected.
Chicago’s top city lawyers are taking aim at the most negligent property owners, and The Real Deal is taking a look inside their plights.
Suzie Wilson, dubbed the city’s “worst landowner” by public officials, is nearing a $11.5 million settlement that could also include a ban from investing in Chicago property.
The settlement would resolve the nearly $50 million in debts and legal claims she’s estimated to owe the city, and she’s not alone. The city is ramping its pursuit of two more firms, Goldmine Investments and QCD Financial, that similarly assembled large portfolios of properties on the South and West sides through delinquent tax sales and racked up a combined $9 million in unpaid fines and interest owed to the city through allegedly neglecting their real estate.
In the office market, the recently stubborn CMBS spigot loosed up to rain down $610 million on the owners of the newly built Salesforce Tower, which includes Hines and Chicago-based Chris Kennedy’s famous political family. The deal replaces $549 million in construction debt.
On the other side of the financial spectrum, Beacon Capital Partners’ 190 North LaSalle Street was listed for sale with Cushman & Wakefield, and, like several of its fellow office buildings in the central Loop, has potential to fall short of its debt with its ultimate sale price.
The Farpoint-led team redeveloping the former Michael Reese Hospital site in Bronzeville released its vision for the Chicago Bears’ new stadium to be built on the land. While the NFL team hasn’t expressed any interest in the site as of yet, the developer is hoping to sway the team away from its previously announced plans to either build a new stadium just south of Soldier Field or outside of the city in Arlington Heights.
Out in the suburbs, developer Advent Properties scrapped a 278-unit Des Plaines apartments project, investor Zell Kravinsky paid $19.3 million to FPA Multifamily for a 63-unit Algonquin apartment complex and FPA Multifamily turned around and bought a big Naperville apartment complex for $68 million.
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