A pair of South Loop multifamily towers totaling 502 units just hit the market.
Real estate giant Brookfield is selling a 411-unit building at 1255 South Michigan Avenue known as Sky55 as well as an affordable senior living building at 1251 South Michigan Avenue.
Brookfield added the buildings to its portfolio through its $11.4 billion acquisition of Forest City Realty Trust in 2018. The bigger building was last refinanced for $96 million in 2020, with Prudential Multifamily Mortgage serving as the lender. The senior living building also obtained a $5.7 million loan from Prudential at the same time.
The listings, which are being marketed by CBRE’s John Jaeger, Justin Puppi, Jason Zyck and Pete Marino, are hitting the market at a busy time.
Chicago has some of the strongest rent growth in the county, and a lack of developments in the pipeline suggests that trajectory won’t be changing any time soon.
At Sky55, market-rate units range from about $2,700 for a one bedroom to $3,700 for a two bedroom, two bathroom unit. Within the property, 30 percent of the units are set aside as affordable with rents ranging from $1,000 to $1,200. The building is 94 percent occupied.
The senior living property is made up of entirely affordable units, also with rents ranging from $1,000 to $1,200. The development was funded in part by federal Low Income Housing Tax Credits. Both properties include ground floor retail.
While the properties are being pitched as value-add opportunities, some investors are hesitant to jump into the Chicago market. High interest rates coupled with an unpredictable property tax system and political environment have been causing the suburbs to outpace the city in multifamily sales.
Still, momentum is gaining in the city. The State Teachers Retirement System of Ohio recently listed a Streeterville apartment building, joining the pack of downtown apartments to hit the market recently.
That 481-unit property, the Streeter at 345 East Ohio Street, last sold 2007 for $210 million.