CHICAGO—The market for multifamily properties on the city's North Side and in its affluent suburbs has gotten so competitive that buyers have grown accustomed to very low cap rates. But double-digit cap rates do exist in Chicago, and investors who feel priced out of the market just need to look south.

Although some properties in areas like Chicago's South Shore neighborhood can involve a higher degree of risk, including higher management fees, higher vacancy rates and more maintenance expenses, a number of stabilized assets in South Shore have recently traded with cap rates of 9 to 12%, and some even higher, Kevin Rocio of ROC Realty Group, a division of @properties Commercial, tells GlobeSt.com.

Rocio and his colleague Chikoo Patel recently represented a private investor that bought a 28-unit apartment building at 7601 S. Yates Blvd. for $1.26 million. The sales price represented a cap rate of 16.24%. Rocio says the building – which was 100% occupied at the time of the sale – had three years of strong financials as well as a laundry list of capital improvements over the past five years that significantly improved the property. The sale closed in June, and the buyer was LLJ Holdings, LLC, a Homer Glen, IL-based firm, according to Cook County property records.