Warren Baker, president of Chicago-based Baker Development Corp., has agreed to purchase the unsold units in two stalled condo conversion projects in Lakeview.
North Community Bank, which took over the properties earlier this year from North Side developer Robert Kroupa, is selling the property to Baker for $16 million. The sale includes the 130 remaining units in the 1960s-era high-rises at 1930 and 3033 N. Sheridan Road.
The price would lower the cost per unit price about 30 percent from $175,000 per unit that Kroupa paid for the buildings to just over $123,000.
In November of 2006, Kroupa paid just of $70 million for the two Sheridan road buildings, according to county property records. He converted the apartments to condominiums, but the market soured and was unable to sell enough units to pay back North Community Bank, which lent him $76.4 million for the venture. The bank took over the project through deed-in-lieu of foreclosure.
Although developers of failed condo projects usually turn to renting as a means of maintaining cash flow, Baker plans to cut prices on the units and resume selling them.
“Historically, those (Lakeview and Lincoln Park) were always strong markets. There wasn’t a glut (of busted condo deals) like in other areas,” says Doug Fisher, a managing director of local real estate brokerage Essex Realty Group Inc., according to an article for ChicagoRealEstateDaily.com. Fisher was not a part of the deal.
When he first bought the properties, Kroupa was able to quickly sell more than 100 of the units at 2930 N. Sheridan in a 21-month period ending February 2008.
As of March, none of the 67 remaining units at 2930 N. Sheridan were leased, and 40 of the 63 unsold units at 3033 N. Sheridan were rented.