Interra Realty, a Chicago-based commercial real estate investment services firm, announced it brokered the sale of a three-building, 114-unit multifamily portfolio on the city’s South Side for $9.3 million, or $81,578 per unit. Two buildings, 7131 S. Bennett Avenue and 1949 E. 73rd Avenue, are located in the South Shore neighborhood, while the third property, 6600 S. Ingleside Avenue, is in the Woodlawn neighborhood.
Interra Managing Partner Lucas Fryman represented the portfolio’s buyer and seller, both based in Brooklyn, New York The purchaser assumed the asset’s existing mortgage, which carries a 3.29% interest rate that matures at year-end 2032. Over the last 14 months, Fryman has advised on 11 transactions in which the buyer has assumed the existing mortgage, an increasingly popular move in the current high-interest-rate environment.
“Assumable loans can provide an attractive alternative compared to options available in today’s capital markets, especially ones that originated in an ultra-low-rate environment and feature non-recourse provisions,” said Fryman. “Astute investors understand this and are accepting lower leverage percentages than they may have in the past, recognizing the quality of these loans and the predictability they provide during a contract period. Interra has carved out a niche for buyers and sellers who need help comprehending the nuances of these deals.”
Collectively, the three buildings include a mix of 51 one-bedroom units, 50 two-bedrooms, five three-bedrooms and eight studio apartments. Completed in 1924 and 1925, respectively, 6600 S. Ingleside and 1949 E. 73rd are home to 28 and 25 units. The properties were 95% occupied at the time of sale.
“What also made this portfolio appealing is that the assets feature strong cash flow and are almost fully occupied, with a mix of market-rate and subsidized tenants,” Fryman added.
As part of the seller’s business plan to add value during the course of ownership, all three buildings have undergone capital improvements in recent years and boast upgraded exteriors, systems and unit interiors. New ownership plans to continue the modernization across properties through updates including newer appliances, fixtures and paint scheme.
The buildings are close to multiple CTA bus routes and Metra’s Stony Island train line. The South Shore Cultural Center resides in South Shore, and is home to a youth art school, reception ballroom, and a golf course. The center boasts a beach as well as nature center. Commuting in South Shore is easy by way of rail stations or Interstate 90. Woodlawn is a suburb of Chicago on the southern coast of Lake Michigan. Harbors, lagoons, parks, golf courses, and public beaches fill this area with all of its coastal charm. Jackson Park is a community hub for outdoor recreation and spreads across 540 acres.
