Author: Alby Galun, Crain's Chicago
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A New York investment firm is poised to pay about $75 million for a new apartment building in the West Loop, a deal that underscores the area's popularity with investors.
Clarion Partners has agreed to pay about $500,000 a unit for Circa922, a 149-unit project at 922 W. Washington St., according to people familiar with the transaction. It would be among the five highest per-unit prices paid for a downtown apartment building in the past five years, according to a report from Chicago-based consulting firm Appraisal Research Counselors.
Investors continue to pay up for downtown apartments, betting that strong demand for rental housing will keep pushing rents to new highs. Working in Circa922's favor with investors is its location, near Randolph Street's nightlife and close enough to Google's soon-to-open Chicago offices on Fulton Market to capitalize on all the hoopla about the neighborhood's coming tech-job boom.
Clarion is buying the development, which includes an older 45-unit building originally developed as a condominiums, from a joint venture of Northfield-based Focus Development, Washington D.C.-based Carlyle Group and Atlantic Realty Partners of Atlanta.
Representatives of the sellers did not return calls, nor did a spokeswoman for Clarion, a real estate firm with $35.8 billion in assets, according to its website. Clarion's Chicago properties include a retail building at 600 N. Michigan Ave. whose tenants include Under Armour and an AMC movie theater.
An executive at CBRE, the brokerage selling the property, declined to comment.
Circa922 includes the older, 45-unit building, and a new 10-story, 104-unit tower, which opened in January 2014. The newer building is 89 percent occupied, with rents ranging from $1,735 a month for a studio apartment to $5,325 for the most expensive two-bedroom, according to Appraisal Research.
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