Illinois Real Estate Journal’s Metro-Chicago Apartment Summit

On March 10th, industry leaders from across the city met at Germania Place for the Illinois Real Estate Journal’s 2015 Metro-Chicago Apartment Submit. The event highlighted ongoing changes in Chicago’s rental market; the influx of more than 3,500 units in 2015 and planned development of more than 6,000 units in 2016 will affect current rents and development projects throughout the city. The panelists largely agreed that the demand for rental units in Chicago is still strong enough to warrant continued development, although some of that growth may be moving outside of the core into more established neighborhoods.

Panelists for the event included developers like Steve Fifield, whose downtown multifamily projects have set the bar for luxury high-rise development in the Chicago core, and commercial brokers such as Todd Stofflet, Managing Partner of Kiser Institutional Group, who provides brokerage services and insight to institutional investors looking to purchase multifamily buildings in Chicago’s outlying neighborhoods. Aaron Galvin, Managing Broker/Owner of Luxury Living Chicago Realty was featured on the second panel to discuss the demands of today’s tenants and how to add value to multifamily assets.

Both of the day’s panels highlighted the shift of luxury multifamily developments from the Chicago core to more well established neighborhoods like the West Loop, Logan Square, Lakeview, and Hyde Park. Improving economic conditions and Chicago’s growing job market has led to greater demand for high-end rentals, even in neighborhoods outside of the core that have older housing stocks but offer opportunities for unique renovations. Stofflet noted that 80% of his investors are looking for vintage properties in Chicago neighborhoods that can be renovated into Class A rental properties.

Aaron Galvin highlighted how redevelopment is the first step in reaching a new crop of luxury renters, but noted that service is an increasingly important component of new developments as the amenities race reaches a draw. Unit and property upgrades like granite, stainless steel, hardwood floors, fitness centers, lounges, and pet-services are now commonplace in all luxury buildings; if developers and going to set themselves apart from the competition, it will likely come down to the level of service and convenience that they offer residents. Online service requests, mobile-integrated units, and a higher-level of customer service will differentiate the classes of luxury multifamily properties in 2015 and beyond.

With the number of units coming to market throughout the city in 2015 and 2016, renters will have an increasing number of lifestyles to choose from. It continues to be a great time to rent an apartment in downtown Chicago.