Multifamily investments in the Chicago area had an up-and-down year in 2015. A summary report from Kiser Group collected data from the counties surrounding the city of Chicago. Sales data from multi-family sales from both Lake counties (those in both Illinois and Indiana), McHenry, Kane, DuPage, Will, Kenosha and suburban Cook counties were included.

  • A Kiser Group report on suburban Chicago activity suggests a successful 2015.
  • Most markets saw gains in sales and per-unit prices.
  • Investors seem to favor the 'burbs that are outside of Illinois.

Multifamily investments in the Chicago area had an up-and-down year in 2015.

A summary report from Kiser Group collected data from the counties surrounding the city of Chicago. Sales data from multifamily sales from Lake, Kane, DuPage, Will and suburban Cook counties were included.

The report excluded city of Chicago sales figures.

The biggest percentage of transactions from the whole pie came suburban Cook county. But compared with 2014’s number, activity was significantly off. The average price-per-unit held the same as in 2014, at $75,000.

The most suburban Cook transactions occurred in the west Cook (Cicero, Berwyn) and southwest Cook (Tinley Park, Orland Park) submarkets.

The highest prices were fetched in the northern suburban Cook submarkets with dense populations. The highest per-unit price was in Evanston, at $214,000. The lowest price came in southern Cook County, at $34,000 per-unit.

Evanston is one of the best performing suburban Cook communities. Arlington Heights and  Mt. Prospect are also on the winner’s list. Those three ‘burbs continue to see pricing premiums due to factors such as low velocity, limited new construction and access to public transit.

Kiser Group

Kiser Group

DuPage County attracts multifamily investors

The next highest percentage of overall volume in the report was in DuPage County. Properties there continued to be highly sought after by multifamily investors in 2015. DuPage notched a 28 percent increase in sales and a 26 percent increase in transaction volume from the prior year.

The greatest number of transactions in DuPage occurred in the eastern submarkets of that county. More that half of the overall county’s transactions were seen there.

DuPage came out on top in the whole market for the highest average price-per-unit. Overall average price-per-unit came in at $81,000. The report’s authors point out that this high price point suggests stiff competition among prospective buyers, and optimism in DuPage from multiple facets of the market including lenders and tenants.

Lake County activity most dense in the northeast

Lake County transaction activity was concentrated in the Northeast submarket, including high supply locations like Waukegan and Zion; however, price-per-unit was also lowest in this submarket. Lake County accounted for 10 percent of the transactions in the report.

Few transactions occurred in southern Lake County. That area typically has a higher price than the rest of the county, so less going on in the southern portion drags down the price for the whole county.

Overall Lake county sales did jump in 2015 from the previous year. The increase is mainly due to two REO sales of Class C apartment complexes in Waukegan which accounted for more than  half of the county’s total sales.

Kane County sales falling

Kane County apartment sales activity declined significantly in 2015, with total sales 33 percent lower and transaction volume 50 percent lower than 2014. Kane’s sales make up 6 percent of what was tallied in the report.

Average price per unit for the county was $56,000.

Will County still benefits from its lower taxes

Will County total sales and average price rebounded in 2015. Two reasons for this are healthy tenant demand and a large pool of active buyers. Will County taxes are lower than in neighboring DuPage County, which translates to lower rents which in turn attract quality DuPage tenants.

Email Kimberley Sirk.

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