CHICAGO-After three years of sitting empty, units at the brand new, formerly named Lexington Park may finally see some use. The failed $110 million condo complex has been rebranded by new owners ST Residential as an apartment tower named the Lex, and locally based Magellan Development Group has repaired and renovated the units for rental as soon as next month.
Seth Hewitt with ST tells GlobeSt.com that the company will open its leasing office on Monday, March 19. “We think the rental market is good in Chicago, as we’ve seen throughout our national portfolio,” Hewitt says. “We think we’ll do pretty well. Our competition in the South Loop, the professional managed new towers, are for the most part stabilized, all the demand should be coming to us.”
Lien and permit delays at the project may have helped ST, as Hewitt is correct that the property is opening during a down time for supply in an extremely hot demand for apartments in the city. Units at the 329-unit property will start at $1,250 per month. The building includes a 35-story tower and a seven-story loft area connected by an outdoor deck.
The project timeline shows a mess acerbated by the recession and the complete drop-off in the condo market downtown. Ireland-based Chieftain Construction Holdings Ltd. took out an $84 million loan for the condos, its first and only US project, at the former Lexington Hotel at 2138 S. Indiana Ave. in May 2007. Locally based Corus Bank provided the loan.
However, the project delivered in the turmoil of 2009, and only a handful of units ever sold to real buyers – most were earmarked for Irish investors. ST Residential, an asset-management firm made up of Starwood Capital Group, Fort Worth, TX-based TPG, WLR LeFrak and Perry Capital, then took over the assets of Corus Bank after it failed in September 2009. Chieftain couldn’t pay the loan, and handed over the deed in May 2010, Hewitt says.
Magellan was brought in to decide whether to convert the units to apartments or a hotel, and the firm made the right choice, VP of development Brian Gordon tells GlobeSt.com. “We didn’t know about the amazing demand apartments would have now,” he says. To make matters worse, many of the units were damaged by a flood at the vacant property.
ST hired Magellan to rebuild the units to luxury status, Hewitt says. The units now have new finishes, high-end appliances, plank flooring and common areas that will include a pool, fitness area, club room and business center. “We should be able to open up the common areas by this summer, and we’ll have a hard launch then,” he says. Magellan affiliate NNP Residential will provide the apartment leasing and property management services.
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