After two years of renting out a failed South Loop condominium project at 1555 S. Wabash, a Los Angeles investor has decided the market is strong enough to put the condos back up for sale.
Built in 2009 by a venture of Chicago-based New West Realty Development Corp, the 176-unit tower closed just 35 sales before getting hit with a foreclosure suit as a result of condo resale prices falling an average of 30 percent from 2008 to 2012. It filed for bankruptcy protection in 2011 and relinquished the unsold condos less than a year later to the Oaktree Capital Management LP tree venture, which had acquired the project’s defaulted construction loan.
As a common survival strategy among developers who couldn’t sell their units after the bust, the South Loop condominiums were rented out. With prices now rising and buyers returning, some building owners, including Oaktree, have decided to cash out by putting their units back up for sale.
Now the 141 unsold units are being offered to tenants before the condos are listed for sale again early next year, according to Chicago-based consulting firm Appraisal Research Counselors. The South Loop offering would be the largest number of rented downtown condos in a single building to be put on the market since the crash.
“We’ve certainly seen firming up in the market in terms of pricing and we’ve seen the unsold inventory get absorbed in the South Loop,” said Appraisal Research Vice President Gail Lissner. “It is a positive sign that market conditions have improved.”
The condos, offering a mix of one- and two-bedroom units ranging from 890 to 1,379 sq. ft., will be priced from the $280,000s to low $400,000s, according to @properties, which is marketing them for the Oaktree venture.
The tower will also be renamed the Guild, and will feature an updated lobby and fitness center and new condo finishes including bamboo floors, quartz countertops and LG, Broan and Samsung appliances.
Other condo-turned-rental projects that have relaunched sales include Emerald in the West Loop and One Place Condominiums in the South Loop.