Midmarket Sales Stand Out in Chicago’s Bustling Multifamily Scene

As the Chicago area multifamily scene keeps heating up, midmarket dealmakers are finding a sweet spot in the city.

A trio of recent sales on the North and West sides of the city indicates that both local and out-of-state buyers are taking interest in Chicago’s inventory of midsized apartment buildings.

At 501 West Deming Place in Lincoln Park, the estate of John A. Brown sold the deceased investor’s 56-unit building for $19.4 million last month. The buyers were a joint venture led by Chicago-based Hayes Properties.

Brown was a longtime owner of the property and last refinanced it for $11.5 million in 2016. The recent $19.4 million sale price came out to about $346,000 per unit, though two groundfloor retail spaces somewhat skew the price per unit.

“This generational location garnered a lot of buyer interest from both institutional firms and families which allowed us to achieve an above-ask purchase price with a solid buyer,” Interra Realty Broker Colin O’Malley said.

Brown earlier this year also sold a long-vacant Gold Coast building. The property, which Brown had planned to convert to condos at one point, sold to Chicago-based developer Altitude Capital for $10 million.

While highrises have to compete for sparse institutional capital, midmarket properties are garnering interest from buyers who can tap into alternative sources of funding.

“We’re finding not only through our capital markets group, but also our clients, that in the midmarket space, financing is not a problem … from the small regional or local lenders all the way up to the national lenders,” said Essex Realty broker Jim Darrow. “They want to lend in Chicago and they want to lend on good, well-located assets.”

Darrow recently arranged a $15.7 million sale on behalf of Chicago developers Frank Campise and Jim Jann of JAB Real Estate, which completed a development play with the deal.

JAB bought a development site at 1553 North Wells Street in Old Town in 2017 and built a 23-unit apartment building with one ground-floor retail space. The retail component is currently occupied by national coffee chain Philz Coffee.

Ground-up development is rare in Old Town, where much of the area is already built out and older buildings still carry high replacement costs, Darrow said.

“These older, vintage-type buildings, they’re worth a lot of money,” Darrow said. “It doesn’t make sense to tear them down and build new construction.”

The JAB property got interest from local and out of state buyers and ultimately sold to San Francisco-based Epp Properties. The sale came out to roughly $682,000 per unit.

Further northwest in the city, developer Noah Properties sold Block Belmont, a midsize building in Belmont Cragin, to local investor Terezia Covaci for $18.5 million.

Noah, which is led by husband-and-wife duo Bart Przyjemski and Anita Lisek, bought the development site in 2020 for $750,000 with a $525,000 loan from Belmont Bank and Trust.

It’s unclear exactly how much the developers put into the construction of the apartment building, but they initially took out a $9.7 million construction loan from Parkview Financial and later refinanced the property with a $13 million loan from GreenState Credit Union in 2023.