The developer of the Lakeshore East got a construction loan from Northwestern Mutual Life Insurance Co. for a 499-unit apartment building on the Chicago River just east of the Swissotel, with plans to break ground early next month. This will be a 45 story rental building north of the existing rental building Tides which was built 3 years ago. So the views of the Tides building to the north will most likely be blocked.
I did not think that Magellan Development Group LLC would start new buildings so fast as the economy is still weak, but I understand that the other rental buildings in Lakeshore East are doing great with a rental rate of more than 90% and rental prices in general increased at least 10% this year. The current rental buildings are the Shoreham, the Tides and Aqua (which is a building combined with Hotel, rentals and condos).
The rental price in Aqua alone has increased 10% in the last two years.
A joint venture led by Magellan Development Group LLC is borrowing $99.5 million from Northwestern Mutual Life Insurance Co. to finance the 45-story building just east of the Swissotel, says Magellan President David Carlins. Chicago-based Magellan and its equity partner, JP Morgan Asset Management, also are investing about $50 million in equity in the high-rise designed by Brininstool Kerwin & Lynch.
Magellan is among a herd of developers racing to get new downtown rental buildings started amid a booming apartment market. Three buildings are already under way, and Chicago-based consulting firm Appraisal Research Counselors forecasts that developers could complete as many as 2,200 new downtown apartments in 2013.
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