#CAROutreach
SPEAKERGAIL LISSNER, CRE, SRAVice President of Appraisal Research Counselors
www.AppraisalResearch.com
ARCAppraisal Research Counselors
Gail Lissner, CRE, SRA
312 565 3423
Appraisal Research Counselors
400 East Randolph, Suite 715
Chicago, IL 60601
Downtown Chicago Market Update...
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ARCAppraisal Research Counselors
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1989
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2003
1Q05
3Q05
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3Q16
Chicago National
Chicago Homeownership Trends…
Chicago MSA 3Q16 – 65.1%
HUD changes agency targets for affordable
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ARCAppraisal Research Counselors
Downtown New Unit Deliveries…
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ARCAppraisal Research Counselors
DT Rental Vs. Condo Deliveries….
100% 100% 100%
39%
0%
49%
13%
0%
21% 24%
0%
22% 24%
10%
23% 23%
8%
32%28%
84%
100% 100%94% 96% 93%
97% 94%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016proj
2017proj
Rental Unit Deliveries - % of Total Deliveries1990-2017 proj.
(c) 2016 Appraisal Research Counselors, AllRights Reserved
2011-2017: Rental units has comprised 93-100% of the total deliveries!
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Neighborhood Apt Development…
11,500+ Units Proposed/Under Construction
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Milwaukee Ave. Corridor – Prop/UC…$3.00 PSF: developers’ target
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The Downtown Rental Pipeline…Green = In Lease Up
Red = Under Construction
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DT Condo/TH New Development Net Contracts…
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DT Condo Unsold Developer Inventory…
0
1,000
2,000
3,000
4,000
5,000
6,000
(c) 2016 Appraisal Research Counselors, All Rights Reserved
Gold CoastLoopNear NorthRiver NorthStreetervilleSouth LoopWest Loop
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ARCAppraisal Research Counselors
DT Condo/TH Unsold Developer Inventory…
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DT Condo/TH Unsold Developer Inventory…
76% over $700+ PSF
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ARCAppraisal Research Counselors
DT Condo/TH Unsold Developer Inventory…
19%
6%
26%
44%
5%Units in the WestLoopUnits in the SouthLoopUnits in River North
Units in the Loop
Units in the GoldCoast
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ARCAppraisal Research Counselors
96 DT Buildings 17,000 Units Price Changes…
© 2016 Appraisal Research Counselors, All Rights Reserved$200
$300
$400
$500
$600
$700
$800
$900
$1,000
2007 2008 2009 2010 2011 1/22012
3/42012
1/22013
3/42013
1/22014
3/42014
1/22015
3/42015
1/22016
Sales Price PSF Trends in Buildings Developed Since 2004
(c) 2016 Appraisal Research Counselors, All Rights Reserved
Gold Coast
Loop
Near North
River North
Streeterville
South Loop
West Loop
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2004+ Deliveries – Sales PSF Since 2007…
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Downtown Condo Price Trends…
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Condo De-conversions…
835 W. Barry115 condo unitsAvg 895 SFBeing mkted by CBRE
2625 N. Clark133 condo unitsSold for conversion to rental
2518-40 N. Lincoln30 res. condo units/New rental building under construction with 200 apts
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ARCAppraisal Research Counselors
Rental development slowing due to Short term imbalance in supply and demand Rising interest rates Construction costs escalating Rent growth slowing – renewals Real estate taxes increasing Land sellers in denial ARO adding cost to development
Modest increase in condo development Greater diversity in product type Gradually increasing project sizes Continued development in neighborhoods
2017 Trends…