Intercontinental and Magellan Buy Chicago Loop Apartments

Peter Palandjian paired with David Carlins’ development giant Magellan to snag the biggest multifamily prize in Chicago so far this year.

A joint venture of Boston-based investment firm Intercontinental Real Estate, whose CEO is Palandjian, and Chicago-based Magellan paid $126 million late last month for the 42-story, 322-unit apartment tower at 73 East Lake Street in the Loop area, public records show. The seller was Tony Rossi and Tom Moran’s Chicago-based firm, M&R Development, which completed the building in 2014 in partnership with UBS Realty Investment.

At roughly $380,000 per unit, the acquisition sets a new high-water mark for 2026. The transaction narrowly bested the year’s previous top trade: the $110 million sale of an apartment complex in Chicago’s southwest suburbs that closed in recent weeks.

The Chicago sale also marks the city’s largest in terms of total price since AMLI Residential’s $134 million purchase of the 275-unit Milieu apartment tower in the West Loop late last year. It’s well shy of 2025’s priciest multifamily sale of $175 million for the 398-unit North Water Apartments in November, which marked the biggest deal in the sector since 2023.

Intercontinental’s purchase marks a significant institutional return for the firm, which has been largely quiet in downtown Chicago since buying the office redevelopment at 811 West Fulton Market from Shapack Partners and Alec Litowitz for $50.3 million in 2019, a record price per square foot for the city’s office market at the time.

Intercontinental, Magellan and seller M&R didn’t immediately return requests for comment Tuesday.

For M&R Development, the sale represents an exit from a property it held for over a decade in tandem with UBS, which bankrolled the cost of construction. UBS provided a nearly $76 million mortgage for the property’s construction in 2012. Details on the property’s financing since then aren’t clear from public records.

The sellers originally explored the market with a listing in 2024, but the apartment building never sold. They re-listed the tower with a CBRE team of John Jaeger, Justin Puppi and Jason Zyck in 2025, betting on Chicago’s robust rent growth and a thinning development pipeline. Peter Marino of CBRE arranged financing for Intercontinental and Magellan’s transaction, though further details of the loan weren’t publicly available Tuesday.

M&R’s principals are veterans of Chicago’s multifamily market, with Rossi serving as president of RMK Management, a property manager with a portfolio of thousands of apartments it operates for landlords in Illinois, Wisconsin and Minnesota. M&R also built the Addison & Clark apartment and retail complex across the street from Wrigley Field on the city’s North Side. Yet, the firm’s partnership with UBS on that development lost most of its equity in a $100 million sale in 2023.

The Lake Street tower, just west of Millennium Park, is known for its high-end finishes and amenities. The building features an indoor pool, a two-story fitness center and the “Club 73” sky lounge on the 42nd floor. Its mix of convertible, one-, and two-bedroom units were 94 percent leased at the time it hit the market.

The investment comes as Chicago’s apartment market cements its status as a national leader. While Sun Belt metros are currently drowning in a glut of new supply, Chicago’s development pipeline has effectively run dry. Construction starts across the metro have plummeted to their lowest levels since 2012, with fewer than 4,000 units projected for completion this year, according to Marcus & Millichap.

”Over the next 12 -24 months, we expect the absolute number of vacant units downtown to be at the lowest levels in over a decade, in spite of the total number of units having virtually doubled since 2015,” Chicago-based research firm Integra Realty Resources said in its annual report last month. “Rents are poised to spike given nominal new supply.”

This supply-side drought has given existing premium buildings like the one at 73 East Lake Street a near-monopoly on high-end demand. With so little new product slated to hit the market in the coming years, stabilized Class A towers are seeing outsized rent appreciation, while competitors in overbuilt markets elsewhere are forced into concession wars — such as offering several months of free rent to new tenants — to keep units filled. As the largest trade of 2026, the $126 million deal is a flashing signal that institutional giants are finally ready to bet big on the Windy City’s scarcity play.