Suburban Chicago’s Stagnant Multifamily Pipeline Revs Up

Two Chicagoland real estate development companies lined up $31.8 million in financing to begin work on a six-story apartment complex in Downers Grove.

Chicago-based LCI Development Partners and Rosemont-based Conor Commercial Real Estate received the construction loan from Wisconsin-based Associated Bank, Crain’s reported. The 138-unit apartment complex at 750 Curtiss Street is set to be completed in the spring of 2027.

Bailard, a California-based asset management firm, is a joint venture equity partner on the project. Conor Commercial declined to disclose total finance and development costs, but the debt amounts to $230,400 per unit.

Conor Commercial is the real estate development and investment arm of Rosemont-based McShane Companies. The construction division of McShane will be building the project. LCI is the real estate investment and development arm of Alexander West Capital, the family that owns Leopardo Construction’s holding company.

The Downers Grove project will add some volume to the suburban Chicago rental market, where demand is up due to elevated interest rates on home loans and remote work attracting people to housing options outside of Chicago’s urban core.

The median net rent in suburban Chicago rose 4.1 percent from a year ago to $2.18 per square foot, or more than $1,500 a month for a typical one-bedroom unit, according to Integra Realty Resources. Compared to recent numbers from downtown Chicago, where top-tier rents climbed 6.4 percent year-over-year in the second quarter, with Class A units averaging $3.99 per square foot, or nearly $2,800 total for a typical one-bedroom, the move into the suburbs is a healthy discount.

The Curtiss Street project is the only apartment development with more than 100 units under construction or in the planning stages in Downers Grove, according to Integra. Elsewhere in DuPage County there are three more apartment complexes underway. Those include an 87-unit project in downtown Itasca, a 334-unit building in downtown Wheaton, and a project that could lead to 600 apartments in Lombard’s Yorktown Center mall.

— Eric Weilbacher