Marquette Buys Lake Bluff Apartments From A&R Katz

Marquette Companies is strengthening its grip on the Chicago suburbs, picking up a Lake Bluff apartment complex as investors focus on the Midwest while dodging the urban core’s volatile tax landscape.

The Naperville-based firm led by Trevor Ryan paid $43.7 million for Forest Pointe, a 232-unit garden-style multifamily property at 29533 North Waukegan Road in Lake Bluff, public records show. The deal solidifies Marquette’s status as one of the region’s aggressive players in both buying and developing, as the broader multifamily market is grappling with a financing drought for new construction projects.

The seller of Forest Pointe is an affiliate of Northbrook-based A&R Katz Management, which bought the property for $34 million in 2016. The deal reinforces that multifamily sellers are netting stronger gains in property value in such markets as collar counties, as Lake Bluff falls in Lake County, outside Cook County’s tax system. Marquette secured a mortgage of just over $33 million from BMO Bank to fund the acquisition, public records show.

Ryan’s firm — which manages more than 14,000 apartments — touted in a press release the property’s proximity to major employers: It’s across Waukegan Road from the Abbott Laboratories corporate campus. A&R Katz didn’t immediately return a voicemail requesting comment on the deal.

The purchase follows a busy streak for Marquette. In November, the firm paid $46 million for the Orion Arlington Lakes property in Arlington Heights. While many peers have retreated to the sidelines, Marquette is also active on the development front, having secured in February a $55 million construction loan for a Villa Park project. It’s a rare feat given the current difficulty of raising equity for ground-up projects in Chicagoland, where the pipeline of new oncoming supply has dried up to near-historic lows.

To drive value at the Lake Bluff property, which was completed in 1992, Marquette plans to overhaul unit interiors with new appliances and finishes while adding a dog park and outdoor lounge areas to the amenity offerings.

Even as Chicagoland’s development pipeline is slow due to high construction costs and interest rates, demand for multifamily properties is still surging. Buyers are seeking existing properties, where rents are rising at a nation-leading pace. Solomon Real Estate Group and LaTerra Investment have each recently poured hundreds of millions of dollars into suburban Chicago multifamily properties, betting a supply-demand imbalance keeps pushing rents and valuations higher.