Condo Building in Uptown Trades in Deconversion Sale

CHICAGO—A 64-unit condominium building here has been sold for $12.5 million in a Section 15 deconversion deal.

Brokerage firm Kiser Group reports that Dover Court Condominiums was acquired by Neriel Lagoon LLC, which plans to convert all of the condo units to apartments. The deal was brokered by Kiser Group’s Rick Ofman and Andy Friedman.

“For over a year-and-a-half we had been receiving unsolicited offers to purchase the property,” says condo board member Michael Wolff. “We decided to hire a broker that would represent not only all 64-unit owners’ best interests, but also find the right buyer that would be able to close the deal.”

The 64-unit, three-story building was initially built in 1925 as apartments. It was converted to condominiums in 2007. The units are predominantly one-bedrooms, with a small percentage of two- and three-bedroom units, Kiser Group states.

“Unlike many condo deconversions, Dover Court did not have a bulk unit owner; 64 units were owned by 64 different people,” Friedman says. “The property was otherwise a perfect representation of why associations choose to pursue a deconversion sale: a high percentage of rental units in the building, depressed resale values, and looming special assessments.”

He adds that the deconversion sale “allowed those that purchased in the frenzied days of 2007 and 2008 to finally recoup their purchase price and was a welcome exit for owners that had been turned into accidental landlords.”

Kiser Group’s Ofman relates that the Uptown apartment market continues to see increased investor interest and notes that during the marketing phase Dover Court had more than 50 property tours and received numerous offers within 5% of the final sale price.

“With all the new construction apartment buildings underway in Uptown, this transaction proves that the demand for vintage properties remains strong,” he says.