Berkshire Residential Investments is looking to sell a River North apartment building even as high interest rates continue to hit real estate values ​​across Chicago.

The Boston-based company, led by CEO David Olney, has hired CBRE to sell the 292-unit 8 O Five building at 805 North LaSalle Street, about Seven years after the property, Crain’s report.

Berkshire Hathaway, which bought the 32-story building in 2016 for $112.5 million, is now testing the market as rising interest rates are weighing on property values, making closing a nine-figure deal difficult. especially difficult. While the local multifamily market is relatively strong, crime rates and an overall gloomy outlook for Chicago real estate have sapped apartment values ​​in the city as capital markets tighten. rent increase As of earlier this year, it has surpassed the national average.

Built in 2015, 8 O Five has an occupancy rate of just over 94 percent and an average rent of $2,564 per month, or $3.75 per square foot. CBRE sees the property as a value-add opportunity, noting that buyers could improve its amenities and raise rents. Potential upgrades include adding a yoga studio, expanding the fitness center or adding a fire pit and couches to the roof deck.

Another desirable aspect for potential buyers is the high income of the tenants. The building’s tenants, who are employed by family-owned businesses including Bank of America, Oracle and Amazon, make an average annual income of $128,885 and are 33 years old, according to a listing.

Other Chicago apartment buildings have recently traded for far less than what sellers originally invested in.nearest green city bought The 329-unit Lake & Wells building cost $98 million, compared with the $123 million it cost to develop the apartment complex 15 years ago.

Less than two weeks ago, Crescent Heights purchase A 400-unit apartment building in Streeterville is on the market for $173 million. That’s 28% less than the $240 million Invesco paid for the property in 2016.

— Quinn Donoghue

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