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Downtown Multifamily Sales Racing to $1B Mark

CHICAGO-Appraisal Research Counselors reports that multifamily property sales could top $1.3 billion this year, shattering the record of $510 million set last year. Condominium converters continue to be the dominant players, monopolizing the bidding on at least one building.

By Mark Ruda | Updated on May 31, 2005

CHICAGO-Downtown multifamily property sales could top $1.3 billion this year, predicts Appraisal Research Counselors, shattering the previous record of $510 million set last year. Already, the firm reports $258 million in multifamily sales have closed, with nearly $600 million in potential deals in the pipeline.

The activity is translating into richer pricing, according to Appraisal Research Counselors’ most recent “Residential Benchmark Report.” Last year’s deals were at a projected capitalization rate of 6.41%, also a record, but the deals closed so far this year were at a 5.24% cap rate. Properties on the market or under contract are at a slightly higher 5.63% cap rate, according to the firm’s report.

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