Another new one in Highland Park

Just finishing up another building in Highland Park that I think might interest some of you.

Unlike many of the apartment buildings we renovate, this one was built by someone who cared about the people who would live there. The ceilings are pretty high, the units have a ton of light, there is parking and private outdoor space, etc.

We did this one on behalf of an investor with whom we’ve done a bunch of deals. Candidly, wish this one were mine!

Here are a few photos:

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The units will go online for leasing this weekend, I believe. Prices are between $2695-2995.

Now leasing: 363 S. Leslie Way

Thought you would appreciate seeing some pics of our latest project, 363 S. Leslie Way, a fourplex we just finished renovating in Highland Park.

Now, obviously, doing fourplexes is not an efficient way for us to put out capital. But our partner was in a 1031 exchange, the clock was ticking, and we liked the deal.

And I think we’ll hit the ball out of the park, since we forecast pretty modest rents.

Below are the pics. If you’re interested in renting one of these beautiful 2 bed / 1 bath apartments with parking and options for private outdoor space and / or office space for around $2300-2400, email krystal [at] adaptiverealty.com.

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How to become a deal gal (or guy)

Was talking over the weekend to a friend of mine about a deal he’s doing with a partner.

His partner pulled a pretty impressive negotiating jui-jitsu move on a counter-party of theirs, one that neither my friend nor I would have even considered, let alone attempted.*

My friend explained that his partner is not really sophisticated about deals (pref, promote, fees, etc.), but that he probably got “deal doing” with his mother’s milk, since his parents have been making real estate deals his whole life and built a pretty big company.

Obviously, I bore Kingsley and Giles to tears with real estate conversations and tours, and I’m hoping for a similar outcome!

 

Some thoughts on windows (zzzzz….)

Today, I want to talk about windows.

Still here? Good.

Windows are a controversial part of the repositioning process. Replacing them is pretty expensive (on the order to $400-500 / window) and, while new windows open / close easily and look nice, no one ever rented an apartment because of the windows.

Still, we intend to own our buildings forever, so we replace all the windows, as a rule. In the rare cases where tight budgets caused us to forgo replacement, we over-performed on the rent and then wished we have spent the additional money to do the windows when we had the chance.

So, we’re into replacing windows. But doing so is dangerous to your project, and here’s why: They’re a massive source of delay.

Think about what happens when you order windows for a small rehab project. The rep for the window company needs to come out and carefully measure each of the windows you plan to replace. Then, he needs to record these measurements accurately, along with your aesthetic choices (frame material, opening direction, etc.). Finally, he needs to forward your specs to the factory, where the windows are produced over the next 3-5 weeks and then shipped to you.

The above is a painful process and its easy to make mistakes. And here’s the kicker: If you make a mistake on the order, there’s no way to correct it quickly. If, like happened to us recently, the window guy accidentally orders the wrong frame material, your entire order may need to be re-done, imposing a delay of a month on your project.

And there’s nothing you can do about it.

Just another problem that you need to manage around if you want to reposition apartment buildings the right way.

 

Some indications that ride sharing may be reducing car ownership

BL, a reader of this blog, sent me an interesting article yesterday about the interaction between Uber/Lyft use and car ownership.

Regular readers know I regard ride sharing as a major force that will re-shape the nature of in-fill real estate development. If you’re just joining us: As the price of ride sharing falls (which it will, once cars are robotic), car ownership will fall, making our existing parking requirements ridiculous and opening up a lot of urban land presently used for parking for other uses.

The reason the article is so interesting is that it presents the first indication that ride sharing may be impacting car ownership. Here’s the money quote:

“Compared to people who haven’t used any shared modes of travel beyond public transportation, people who use Uber and Lyft own nearly half a car less — 1.5 versus 1.05 cars per household…”

Now, anyone who reads even a little social science knows that correlation is not causation. So, the fact that Uber/Lyft users own fewer cars doesn’t mean that ride sharing is causing them not to buy cars. In fact, it may be just the opposite: Poor people who can’t afford second cars may have been using taxis before, and ride sharing is just replacing their taxi use. Or there could be a million other explanations.

Still, this is one piece of evidence that city-dwellers may be heading in the direction of reduced car ownership. And that means cities may be headed for a gigantic change.