06.05.18
GlobeSt: Suburban Workforce Housing Providing Good Cap Rates
By Brian J. Rogal, Globe St.
CHICAGO—The demand for rental apartments has attracted a number of national investors to the Chicago metro, but not all of these major purchases involve class A properties in high-end areas. Kiser Group, a local mid-market multifamily brokerage firm, recently brokered the sale of Blue Station Apartments, located at 2130 W. 122nd St. in suburban Blue Island, for $18.6 million.
The buyer, an undisclosed national portfolio owner, purchased the 345-unit apartment complex from Kinzie Realty Corp., which assembled it through multiple acquisitions and then branded and managed them as Blue Station Apartments. The deal was brokered by Lee Kiser, Kiser Group’s principal and managing broker, and Matt Halper, a broker with Kiser.
“Kinzie took an institutional approach to a non-institutional part of the market making the workforce housing complex a community, complete with a full staff and tenant services,” says Kiser. “This isn’t a typical investment strategy for workforce housing, but it has worked well for Kinzie Realty Corp.”
Community amenities include an on-site convenience store and daycare center. Blue Station Apartments offers tenants easy access to the city with Metra stops steps from the complex – at both 119th St. and 123th St. The complex is also a half mile from I-57 and three miles from I-294.
“This deal is a good example of a win-win,” adds Halper. “Kinzie bought the distressed units and had a strategic plan to renovate. They were able to make good returns on their successful value-add strategy, and buyer was able to get a very attractive cap rate on the acquisition.”