The state of Illinois will receive $15 million for a Home First Illinois initiative to take unoccupied Chicago condos and convert the units into residences for those with physical disabilities. This massive undertaking will enable Chicago-area residents with certain physical disabilities to live independently.

Funding for the project comes from the capital program called Illinois Jobs Now! The program does more than just provide new living opportunities to Chicagoans, it also create jobs, saves the state of Illinois money, and replenishes unused Chicago real estate.

The initial stage of the project includes eighteen Chicago condos that are to be rehabilitated and used for the program. Nonprofit lender IFF received financing for the project from the Illinois Housing Development Authority. These funds will be used to rehab vacant condos in buildings with elevator service.

Additional accessibility features that will be installed in the renovations are wider doorways, bars and handles in the bathrooms, and flashing lights that notify hard-of-hearing residents of visitors. Access Living, a not-for-profit organization, will assist new condo occupants with relocation from institutions into the new condominium units. The President and CEO of Access Living had this to say about the venture, “This is private/public partnership at its best. The purchase of distressed properties will help communities grow stronger, and people with disabilities in institutions will find a place to live in the community.”

Governor Quinn believes the program will aid the state’s economy through renovating vacant properties into appealing places for people with special needs to live. “By increasing accessible and affordable housing opportunities for our state’s residents with disabilities, we are helping to increase their independence and improve their quality of life,” Quinn said in regards to the rehab initiative. “Through this program and other initiatives, we are expanding choices for those who want to live in the community.”

Home First Illinois plans on developing nearly 100 affordable and accessible Chicago homes over the next three years. The project is set to receive $4 million from Chase Bank as well as $125,000 from The Chicago Community Trust for operational support. These new units are expected to benefit a total of 145 residents with physical disabilities in the Chicago area. The project will also create 21 new construction jobs.

A proposed high-rise is causing some neighborhood people to pipe up in Lakeview. The high-rise’s developer, JDL Development Corporation, is looking to build a new residential/retail space consisting of 17 stories and is getting an adverse reaction from neighbors regarding the building’s lofty size.

Opponents of the development said they either want the project to be smaller or to be terminated completely. Reasons of dislike for the building vary between feeling it will saturate the Lakeview real estate market because it has too many residential units, and worrying it will increase street traffic and block views, especially for the buildings located on Grace Street.

The $100 million project would be located at 3750 N. Halsted, on the corner of Barry and Halsted Street (just south of the IHOP restaurant in Boys Town). This site is currently occupied by the Faith Tabernacle Church’s parking lot. The proposed Chicago real estate would replace the parking lot with around 350 apartments on top of retail space that spans 46,000 square feet. It would also include parking that could be used by both tenants and shoppers.

According to an article in the Chicago Sun-Times, Halsted Neighbors is a newly formed group that opposes the development and claims it has gathered over 300 signatures for a petition against the project. The group stated on their website that they believe the proposed Lakeview apartment development is too big and will lower property values while creating a housing surplus.
On the other hand, Jim Letchinger, president of JDL Development, said his new mixed-use project has gathered much support from other communities, due to the fact that Lakeview real estate has had little new construction in rental housing during the past two decades. The focus had been on building condos for so long that many see a high demand for the new apartments now.

Letchinger and Alderman James Cappleman’s 46^th Ward zoning advisory committee met on December 8^th regarding the proposed Lakeview real estate. So far, Cappleman seems to have taken a neutral position on the development, which is to be designed by Hartshorne Plunkard Architecture and will contain only a few units with balconies. The building will, however, include a private courtyard and outdoor pool.

There is already a contract pending to purchase the land from the Faith Tabernacle Church, which would receive renovation funding and be allowed to maintain parking on the site if the project were to move forward. Blueprints for the complex include a 369-spot parking lot that would be accessible to both apartment dwellers and shoppers. As to what type of business is expected to lease the commercial section of the building, Letchinger claimed rumors regarding a Wal-Mart or grocery store are untrue. He proposes a health club will most likely be in the retail space, but said that a deal is yet to be completed.

Seeing specific examples of real estate activity in Chicago can help paint a picture of what’s happening on a larger scale. Here’s a look at what types of luxury Chicago homes have sold recently, as well as those that are up for sale in the Gold Coast, Lake Forest, Winnetka and other affluent areas of Northern Illinois. These examples come from an article on Chicagorealestatedaily.com that was posted in November.

Gold Coast

A landmark Gold Coast greystone, built in 1881, has been listed for $3.95 million. The Chicago home for sale includes 7,500 square feet, seven bedrooms and sits on an extra-wide lot. The Romanesque-style Bellevue Place Chicago home was listed by Randy McGhee of Koenig & Strey Real Living and includes four fireplaces, five en suite bedrooms and a four-car garage.

Lake Forest Home

A five-bedroom home in Lake Forest recently sold for less than its 2007 price – 15% less. Mark Grube, a managing director at a health care consulting firm, purchased the Estate Lane Colonial for $1.63 million from Jay and Joy Lenstrom in October 2011. The Lenstroms purchased the home for $1.91 million in 2007.

Lake Forest Estate

An eighteen-room historic, English Manor estate in Lake Forest sold for $6.39 million. The estate is located on Green Bay Road and has seen bedrooms and eight full bathrooms. The seller, Lake Forest Landmark Development, purchased the home for $2.4 million in January 2008. The hundred-year-old home has been completely restored and details such as the original hardwood floors, ceiling molding, and staircase handrail have been preserved. The estate sits on 2.5 acres and the buyer purchased an adjacent one-acre lot. The home includes a four-car heated garage, an attic that has been remodeled into a third floor, a finished lower level, and a detached gardener’s cottage with a kitchen, two bedrooms and two full bathrooms.

Winnetka

A 5,000-squre-foot home in Winnetka, containing six bedrooms and 4.5 baths, sold to a personal injury lawyer, Jeffrey Sussman, for $1.7 million. The Grove Street home resides on half an acre and includes a pool. The original owners purchased the home for $1.95 million in 2000.

South Barrington

A 6,100 square-foot, six-bedroom home in South Barrington sold for around $1.63 million. Chief financial officer of Sirva Inc., Thomas Oberdorf purchased the Wescott Lane home. The seller originally purchased the house in 1995 for $825,000.

Northfield

A Cape Cod-style home in Northfield sold for around $1.43 million to Thomas Melzl, the regional VP of sales for Redwood Shores, California-based Oracle Corporation. The Laurie Lane home contains six bedrooms and four and a half bathrooms, and was purchased by the original owners for $1.33 million in 1998.

William Wrigley Jr. is selling two penthouse Chicago condos, in addition to the landmark downtown headquarters of his family’s namesake business.

According to a November article in Crain’s, William Wrigley Jr., great-grandson of William Wrigley, Jr., founder of Wrigley chewing gum, is selling his Chicago real estate. In 2008, Mr. Wrigley sold the company to Mars Inc. for $23 billion. Mr. Wrigley stepped down as executive chairman of Wm. Wrigley Jr. Co. in January 2010 and the company is now preparing to depart from its landmark headquarters located at 400-410 N. Michigan Avenue. Wrigley sold the Wrigley building for $33 million and the plans are to move the Wrigley headquarters to Goose Island offices in 2012.

In tandem, Mr. Wrigley is selling his Chicago homes: one lakefront mansion in Lake Forest and two penthouse Chicago condos in the Gold Coast. His Lake Forest home, designed by architect Howard Van Doren Shaw was built in 1908. Its amenities include a five-car attached garage, a pool and a private beach. The sixteen-room home located on Lake Road consists of 11,000 square feet and has a sale pending from October 31^st for $6.9 million. The Chicago home had been previously put on the market for $14.5 million. Mr. Wrigley purchased the seven-bedroom, nine-bathroom home in 2003 for $9.9 million.

Wrigley’s Chicago condos in the Gold Coast neighborhood at 65 E. Goethe Street are part of a penthouse that he purchased in 2002. Developer Fordham Co. sold the property to Wrigley for just under $9.13 million. The 13,200-square-foot unit is unfinished and has been split into three separate units. In 2009, Wrigley placed the Chicago condos on the market for $14 million. Raw spaces such as this can appeal to buyers due to the lack of new construction in old neighborhoods like the Gold Coast.

Two of the three Chicago condos for sale were listed in June 2010 – the unit on the west was listed for $6 million and the unit on the north for $5 million. The listing for the west unit has dropped to $4 million recently. The north unit was dropped to $4.5 million and now has a pending sale. The third, unlisted unit has just acquired a pending sale.

Even though the market for Chicago condos is recovering at a snail’s pace, a few Chicago condos are taking the risk and undergoing development. Neighborhoods like West Town and the Ukrainian Village are seeing this primarily. The projects are mostly small and the developers are keeping the risk low and constructing them in stages.

One of these Chicago real estate projects is located at 1312 W. Madison. The building is owned by Quest and contains nine units. The project is currently in its second phase, as the first phase had begun in March 2011. The development is expected to complete in May and a buyer has already signed an agreement to purchase one of the Chicago condos.

The Chicago real estate was purchased last fall by Quest from Lakeside Bank, based in Chicago, after the bank had foreclosed on the former owner. A loan for the first phase of the project was taken out for the building, which includes six residential and two commercial units.

The second phase will begin with the owner’s own money. However, the owner might need to take out a small loan for the project after the Chicago condos from the first phase close in December. The residential units will be priced from $425,000 to $490,000. Developers are predicting that people will buy if the building is in a good location and is sold at a reasonable price.

East of the Madison building, only a few blocks away, the CA23 development is under way. These Chicago condos are located at 16-20 N. Carpenter Street. The property is in its second phase of construction–all 24 of its first phase units completely sold out last summer. The building, which was previously owned by a bank due to foreclosure, was purchased for $4 million in cash by Belgravia Group.

In this economy, a few lenders are requiring developers to complete Chicago real estate projects in two stages so the demand for additional units can be reevaluated before breaking ground on the second batch. For example, the Chicago condos located in Ukrainian Village called EcoLuxehome had a difficult time with financing. The developer, Igor Petrushcak, wanted to develop a 14-unit Chicago condo complex on the 2200 block of W. Chicago in its entirety but was unable to receive proper funding to do so. Therefore, this project–as well as other Chicago real estate owned by Mr. Petrushcak–will be developed in two stages. EcoLuxhome will be financed with the developer’s own money and a $700,000 construction loan from Selfreliance Ukrainian American Federal Credit Union.

Another thing many developers are facing with their Chicago real estate projects is stringent lender guidelines. Many banks require that 70% of Chicago condos in development be under contract before any residents can even move into the building.

Fourteen vacant lots on the 1500 block of W. Montana Street have been bought for $3.6 million, according to a November article from Crain’s, posted on the publication’s online outlet Chicago Real Estate Daily. Belgravia Group Ltd. recently signed a contract to purchase the lots for about $$260,000 a piece from a venture managed by Robert Birkmeyer, a Chicago real estate investor.

For two years, the lots had been for sale individually: $539,000 per 25-foot lot and a 50-foot lot listed for over $1 million. The lots had been difficult to sell individually because buyers were leery about what would be developed around them. Additionally, the seller recently endured a foreclosure suit for the lots by BMO Harris Bank. When Mr. Birkmeyer originally bought the property in 2004 for $6 million, it had been a factory. The building was then torn down and readied for development through environmental remediation.

Belgravia Group has proposed to build single-family Chicago homes on the site. The row houses are to include 4 bedrooms, 45-foot private yards and two-car garages. They are expected to list for a little under $1 million each. There is a market for row homes in the neighborhood as an alternative to the higher pricing of detached Chicago homes. However, before anything can happen the developer needs a zoning change from the city of Chicago. Only then would the company be able to make a sales model in order to market and sell the Chicago homes.

Area real estate agents believe Belgravia is getting a very good deal on the lots, which are worth more like $450,000 a piece considering their sought-after location. The lots are located near the intersection of Fullerton and Ashland avenues, which is an attractive area because of neighboring Wrightwood Park.

The developer has other Chicago real estate projects going on in addition to the Montana Street lots. A condo development called CA23 is being constructed in the West Loop. The developer also has confirmed plans to build 24 more Chicago condo units at 16-20 N. Carpenter Street. The condo project’s initial building sold out all 24 units this past summer.

Downtown Chicago condos under development closed 229 sales during the 3rd quarter. That is better than 2nd quarter 2011 sales (which hit 196) but is a decrease from the 251 deals closed during the 3rd quarter of 2010, according to a report from Appraisal Research Counselors, a consulting firm based out of Chicago. According to an article in a November issue of Crain’s, psychology plays a huge factor in what is working against developers of Chicago condos with potential buyers. Consumers fear prices falling and many are noticeably waiting out the market.

Developers of Chicago real estate who slashed prices to attract sales were selling leaders during the third quarter. Pricing is a decisive motivating factor regarding resistant consumers. For example, one-bedroom Chicago condos previously priced at $259,000 were lowered to $155,040 and included free parking; two-bedroom units fell from $369,900 to $229,500. Additionally, many first-time buyers of Chicago condos have stepped into the market, mostly due to locale, price points and incentives such as a grant from the city of Chicago for $10,000.

First-time purchasers of downtown Chicago condos were most helpful to raise sales during the third quarter, especially for developments such as 757 Orleans, 200 N. Dearborn, Silver Tower, Quincy 565, 235 West Van Buren and Parkside of Old Town on Division Street, a redevelopment of what was previously Cabrini Green public housing.

Parkside Old Town had the most closings during this quarter, after slashing prices 30-40%. The number of Chicago condos sold in this development reached 26 units, out of a total 161. Parkside of Old Town, constructed by Holsten Real Estate Development Corporation, worked with lenders in the Chicago Housing Authority to produce a new pricing schedule. The undertaking incorporated Chicago condos with market-rate and market-rate inexpensive units, as well as CHA replacement housing in townhomes and two mid-rise properties.

Some high-end downtown Chicago condos sold reasonably well during the 3^rd quarter, even though they aren’t the most attractive to first-time buyers. A few of these Chicago condos include the Trump International Tower, the Aqua and the Legacy at Millennium Park.

According to the article from Crain’s, there will not be any newly constructed units placed on the Chicago condo market this year. Chicago real estate that is currently under construction and scheduled to open in 2012 includes the residences at the Ritz Carlton and Lincoln Park 2520. Even though demand for downtown Chicago condos has been weak, supply is recovering, primarily because a lot of Chicago condos have become rental units.

The number of Chicago condos and townhomes that remain unsold fell to 2,198 during the 3rd quarter of 2011–it was as high as 7,689 in 2007′s 2^nd quarter. Developers of downtown Chicago condos closed on 614 condos and townhomes during the first nine months of 2011, compared to 1,431 in 2010.

The former residence of Chicago’s downtown flagship Carson Pirie Scott & Co. store, the Sullivan Center, has recently acquired a bidder, according to a November article in Chicago Real Estate Daily. The building is a national historical landmark designed by architect Louis Sullivan. It has been a Chicago favorite since it opened in 1889 and has long been a cornerstone of the city’s classic architectural beauty. Located at 1 S. State Street, the property is literally at the “center of Chicago.”

The Sullivan Center is currently owned by Chicago developer, Joseph Freed & Associates, LLC. Freed & Associates originally purchased the building in 2001 and immediately began renovation. In 2007, Freed took out a $133 million, three-year syndicated loan with National City Bank to fund the construction and refinancing. In 2008, when PNC acquired National City Bank, the loan increased to $148 million and has been paid off in part by the City of Chicago’s $8.5 million tax increment fund.

The reason the loan on the Sullivan Center reached default is because the owner did not pay the lender, PNC Financial Services Group Inc, for the matured loan in March 2011. This was after Freed & Associates negotiated a one-year extension on the loan with PNC in March 2010. Even though the renovation of this iconic example of historic Chicago real estate won awards, the owner has had difficulty finding and retaining occupants for the building.

Nine months ago, Target Corporation signed a 15-year lease for 125,000 square feet of the Sullivan Center’s retail space to house a new store that is scheduled to open in October 2012. Since then, Target has said it would extend the plans an additional 30,000 square feet for an even larger store showroom. The Sullivan Center building is currently zoned for multi-use and houses retail and office space. According to one report, the structure will be 82% occupied with the addition of the Target store.

This isn’t the first time Freed & Associates has had trouble paying for one of their properties. The group recently lost another piece of prime Chicago real estate—Block 37 of State Street—to foreclosure. Winthrop Realty Trust, a real estate investor based out of Boston, MA, currently holds the leading bid for the Sullivan Center. PNC reached an agreement with Winthrop Realty Trust that for every dollar of the building’s defaulted loan (now totaling $137 million), Winthrop will pay just 90% of the cost or 90 cents.

The two towers of Regents Park, located in Chicago’s Hyde Park neighborhood, have sold. Crescent Heights, from Miami Florida, finalized a sale of the Chicago apartments to Antheus Capital, through the firm RP Holdings, LLC, according to a November article on Globest.com. The $159 million sale marks the largest transaction for apartment sales in Chicago since the beginning of the recession. Crescent Heights initially bought the building from Vornado Realty Trust for $128 million in 2005.

Once a notably crime-ridden property, the Chicago apartments were renewed by developer Bruce Clinton. The towers, complete with 1,031 units, were originally built in the 1970s and formerly served as a resort hotel for the U.S. Army. Antheus Capital, which owns other multifamily Chicago real estate, has already begun operating the property.

The Chicago apartments are around 980 sq. ft. per unit and are priced for rent at approximately $1,400 per month. The south tower of Regents Park is 37 stories high; the north tower is one story shorter. At present, the Chicago apartments are 90% occupied and house a lot of students and faculty from the University of Chicago, which is located nearby. Some of the conveniences afforded to residents of the towers are an indoor play center for kids, a restaurant and gourmet market (that offers room service), a health club, an indoor heated pool with retractable roof for warm, summer days, and a heated indoor parking garage complete with 688 spaces.

The Midwest region of the U.S., particularly Chicago, has some of the strongest markets in the real estate world in recent times. And now, a new Case Shiller report has revealed that the Chicago-area is in the middle of a four-month run of price increases—for both detached homes and Chicago condo units.

While those who purchased Chicago real estate during the height of the housing bubble have definitely lost value (around 29.2% for a single-family homes and 28.2% for Chicago condos), there has been a notable improvement in prices as of late, according to Case Shiller’s home price data list released in August 2011.

Case Shiller’s August index shows the price of single-family Chicago homes is on a 4-month bounce, rising 8.4% over the period and 1.4% since July. Chicago condos have also demonstrated a short-term recovery with five months straight of price increases that totaled a 12.6% gain (however, up just 0.6% from July to August). Still, there is skepticism whether Chicago home prices have truly bottomed out or not. Many real estate experts are hesitant to declare a stabilization of values since the housing market has experienced this type of month-to-month improvement before.

The Illinois Association of Realtors released data in September that showed Chicago home sales rose 13.3% for the month for a total of 6,035 properties sold. However, the median price of $160,000 was an 8.6% decrease from the $175,000 documented last year. With the exception of DeKalb, all nine Chicago-area counties had similar findings: sales increases and lower median prices. The price decline was 5.3% in Cook County.