Multifamily developers with sizable proposed projects outside of downtown Chicago are likely to have a increasingly difficult time obtaining construction financing. Take Chicago-based JCF Real Estate for example. The developer recently hired CBRE to sell a 3.5-acre development site near O'Hare International Airport, which has been approved for a 394-unit development since mid-2012, according to Crain's Chicago Business. The primary reasons cited for the project being delayed: an inability to secure roughly $35 million in construction financing and difficulty cementing a joint venture agreement with another developer. During a time of possible multifamily overbuilding within a specific submarket, financiers and joint venture-focused developers typically prefer to lend/team with a local real estate firm that possesses experience and local knowledge, which would seem to describe JCF. The fact that the project was unable to obtain financing or a joint venture development pa...
- JCF received approval for the project in mid-2012.
- The listing of this development site could be a sign that lenders are growing cautious of further out Chicago rental projects.
- JCF filed for Chapter 11 bankruptcy protection earlier this month.
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