Category Archives: real estate

Home Prices Rising in Chicago and the Nation

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Photo courtesy of Mark Moz
Photo courtesy of
Mark Moz

Several parameters have conspired to raise the price of homes in the Chicago area: mortgage rates below 4 percent; home loans are easier to come by; strongest job market since the recession; more people wanting to buy homes. And now, as the housing market enters the traditional season for home purchases, a shortage of homes has added more fuel to the fire of rising home prices.

The real estate website Trulia conducted a study showing that people across the country are finding it difficult to find a home they want to buy at a price they can afford. In Chicago and the surrounding area, and in Illinois in general, sales continue to rise, according to the Illinois Association of Realtors.

“Illinois continues to see sustained growth in sales and median prices, indicating the market is poised for a strong rollout for the spring selling season,” said Mike Drews, president of the state Realtors group, in a statement.

Home sales in the nine-county Chicago area rose by 6.1 percent in February, compared to last year, and prices rose by 7.1 percent. The median price for homes and condos sold was $187,500, compared with $175,000 in February 2015.

In Chicago itself things were even worse: The median price for homes and condos was up by 12.3 percent, to $238,000 from $212,000 in February 2015.

“There was a lot of movement in 2013 and 2014, but 2015 slowed,” said Carla Walker, an agent with Berkshire Hathaway Home Services Koenig Rubloff.

Chicago Home Sales Up in 2015

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Despite a downturn in the rate the rest of the country is taking out mortgages, the Chicago area has seen an upward spike in home loans at the end of 2015 as compared to the same time period the year before.

In addition, area re-financing also grew during the fourth quarter of 2015, rising at a rate of over double the national average.

Chicago-region buyers received 20,870 mortgages to purchase homes during the last three months of 2015, representing an increase of 3 percent over the last quarter of 2014 when 20,275 mortgages were acquired. In the rest of the country the national average of purchase mortgages fell by one percent.

The number of mortgages taken by home buyers is not a direct measure of the total number of homes purchased, since some people do not use a mortgage to buy a home, if they have enough cash. The Chicago area experienced a 6.6 percent overall rise in home sales for 2015 as compared to 2014.

Palmer House Available for Purchase

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Palmer House
The Palmer House is one of Chicago’s famous and historic landmarks. Photo by Tony Brooks.

Considered by many as Chicago’s First Great Hotel, The Palmer House is up for sale.
The historic hotel is probably most famous for the on-the-premises invention of one of America’s most beloved confections: the chocolate brownie. Bertha Palmer is responsible for our added waistline inches and dental caries, all of course well worth it. She was married to Potter Palmer, the man responsible for the success of the grand hotel. Here is how it happened:

“Bertha Palmer, who was president of the Ladies Managers of the World’s Fair, was doing box lunches for all the guests but she wanted something other than piece of pie or cake. So she came to the hotel and charged the chef to make something like a cookie. Denser, like a cookie, but chocolatier. She loved chocolate. And ergo, the brownie,” Palmer House historian Ken Price said.

It is not just brownies that has made Palmer House special. Less than two weeks after Palmer House opened on September 26th, 1871, the Great Chicago Fire left the hotel nothing but a pile of ash. From the ashes rose the second incarnation of the hotel two years later, setting several precedents for their new establishment.

Price explained: “First, totally fireproof building. Second, is first utilization of Edison’s invention the lightbulb, Bell’s invention of the telephone, and actually this contraption called the vertical railroad, which became the Otis Elevator.”

Chicago Rental Costs Not So Bad Says New Zillow Study

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The Chicago River as seen from the Lake Street Bridge. Photo by Mike Boehmer.
The Chicago River as seen from the Lake Street Bridge. Photo by Mike Boehmer.

A new study conducted by Zillow puts the median rent across Chicago at what turns out to be a not-so-high $1,642 per month. Just compare that figure to a typical rental in San Jose, the Silicon Valley town outside San Francisco: $3,398 per month.

According to Zillow’s study the Chicago figure is pretty average for the United States in general, only slightly higher than $1,382 per month. Additional good news for Chicagoans is that their rents seem to be holding pretty steady in comparison to the rest of the country. Rentals in Chicago only 1.4 percent this past year, compared to an increase of 4.5 percent in the rest of the US.

It is expected that rents in downtown Chicago will be eased when new construction there is completed.

The cheapest rentals out of 35 of the country’s largest cities are in Pittsburgh where the average stands at only $1,097.

Chicago’s iconic Tribune Tower is Available for Purchase

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Chicago Tribune Tower. Photo by Luke Gordon
Chicago Tribune Tower. Photo by Luke Gordon

Tribune Media, owner of Chicago’s 36-story Tribune Tower, announced that it has acquired the services of real estate investment banker Eastdil Secured to explore the different options for selling or re-developing the property.

President Murray McQueen of Tribune Real Estate said that this deal can be “an incredible opportunity.” He added that they expect a lot of interest in this property from a large assortment of private and institutional investors and developers.

The Tower was built in 1925 and was granted landmark status in 1989, and is the home of the Chicago Tribune.

Hoffman Estates Looking forward to Two New McDonald’s Locales

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Photo by juanstermonster
Photo by
juanstermonster

A McDonald’s is being considered to fill the space left empty by the long vacant Myoda Computer Center in Hoffman Estates outside Chicago. Myoda, located at 1070 North Roselle Road was taken over by a bank five years ago when the mortgage on the property was foreclosed.

Hoffman Estates is planning other improvements to their village, including putting in a traffic light this autumn at the entrance to the shopping center on Roselle Road.

If the plan for the McDonald’s is given a green light, then Hoffman Estates will have two of the newest McDonald’s in the area, instead of one of the oldest ones. That’s because the old McDonald’s is coming down as soon as a new, already approved, McDonald’s at Barrington Square Town Center opens up.

The Myoda building is a two-story structure that housed a computer store, but also had space for other tenants. The land is now owned by the BBCN Bank, which is planning to sell the property to a broker, who will then contract a lease for a new 4,338-square-foot McDonald’s complete with dual drive-through lanes.

If approved work on the new McDonald’s most likely won’t begin until the beginning of the next construction season, said Peter Gugliotta, Director of Planning, Building & Code Enforcement for Hoffman Estates. Once begun it should take between four to six months for the fast food restaurant to be completed.

Developer R2 Bringing Innovative Business Space to Pilsen

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Matt Garrison, managing principle of R2, a Chicago-based developer, announced that his company is planning to convert a 300,000 square-foot warehouse into office space. He said when the space in Pilsen is done it will be one of the largest office projects completed outside the Chicago central business district.

As of today R2 has the potential for a deal with a group of investors headed by Raymond Chin who own the five-floor vacant structure located at 465 West Cermak Road, along the river.

R2 has been rapidly looking for projects to develop non-traditional office locales, and its venture into Pilsen is just the latest on the Near South Side of Chicago.

Garrison explained that R2 is constantly looking for new areas for innovative offices as a response to the high cost of property in other areas of Chicago.

Chicago’s Commercial Real Estate for 2015

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There have been significant real estate sales in the commercial realm in Chicago since the beginning of this year.  Most notable to date have been the three tallest towers that are in the sale process.  In addition to those, the sale of downtown office towers from January to June 2015 reached a value of $4.19 billion combined.  That alone – just for the first half of the year – was more than the total of sales in the same category of 2014 in Chicago.

What has yet to have been calculated are the largest deals that are in process, including the sale of the Aon Center, the city’s third tallest building, that is due to reach $712 million.  According to Senior Vice President and Investment Sales Expert at JLL, broker Nooshin Felsenthal, Chicago will “at the very least meet that $5.3 billion record and I’m pretty confident we’ll blow right past it.” The other two of the large towers that are in the process of sale is the two-tower Illinois Center, which will be sold for $376 million.