luxury apartment Archives | Luxury Living Chicago Realty

Luxury Living Chicago Realty Presents Fulton Market Multifamily Data

Posted on July 15, 2022July 18, 2022 by LLCR Team

Luxury Living Chicago Realty’s CEO Aaron Galvin delivered a presentation at Bisnow’s The City of Fulton Market event on July 13. During the presentation, Galvin outlined the company’s growth over the past 15 years while also forecasting what’s to come for multifamily in Chicago’s West Loop/Fulton Market.

The Growth of LLCR

Galvin began his presentation by recognizing his team of 70, which has leased more than 20,000 apartments over 15 years — comprising a staggering 35% of all new unit leasing in downtown Chicago. With a focus on Class A leasing and luxury condominium sales, the LLCR team has expertly leased or sold $5 billion+ in capitalized value.

By collaborating with numerous developers, capital partners, and multifamily partners, advising across all areas of the development, marketing, and leasing process, Galvin said that LLCR is ensuring “success with these multi-million-dollar investments that make up the fabric of our city.”

TruRent – Real Time Class A Apartment Data

To best understand what makes Chicago multifamily successful, Galvin said it is first necessary to delve into the mind of the Chicago luxury tenant. “Renting an apartment is one of the most financially and emotionally significant decisions in someone’s life” noted Galvin. LLCR recognizes this and provides both qualitative and quantitative data for renters and developer clients.

Over the last two years, LLCR has developed TruRent, a proprietary technology platform that captures real-time data on Chicago’s Class A luxury apartments. LLCR is now tracking nearly every unit that comes on the market in Chicago and every unit that gets leased at the actual unit level.

This allows the company to create the most accurate market studies which help inform pricing for our current clients and future developers and capital partners.

Historical Delivery Data

Touching on the historical data of the area since 2016, Galvin said the area has had approximately 4,000 units deliver — mostly from 2019-2021. For the properties delivered to date, the average size of the building is right around 300 units with an average unit size of about 750 SF.

All of these properties have extensive interior and exterior amenities and upscale finishes including stainless steel appliances, quartz countertops, luxury plank flooring, an in-unit washer-dryer, and custom closets. These are some of the nicest buildings in the city.

Current Market Data

In total, there have been about 25,000 new luxury apartments delivered to these neighborhoods since 2016 across 60 properties.

Based on data from Q2 2022, Galvin said Chicago’s multifamily market is robust, with Class A luxury apartments 94%+ occupied and average rents at an all-time high of nearly $4.00 per square foot. The average gross rent exceeded $3,000 in Q2 2022.

On both a PSF basis and Gross Rent basis, Old Town/Gold Coast leads the way with River North and Streeterville slightly behind. All of these submarkets have had significant new deliveries in the past 2-3 years at the very top of the market.

In West Loop/Fulton Market, the most recent price-per-square-foot is $3.93 and the average rent is $2,903. The only reason West Loop/Fulton Market is not higher is due to the lack of view premiums. For comparison, the average height in West Loop/Fulton Market is 19 stories. Streeterville’s average is 47 stories. High-floor units in most neighborhoods feature lake and city views which renters are willing to pay a premium for.

As larger scale and taller properties deliver in the next few years in Fulton Market, Galvin predicts West Loop/Fulton Market average rents will exceed Loop/Lakeshore East and be on par with River North and Streeterville.

West Loop/Fulton Market YTD

With minimal supply and increasing demand, rents have continued to increase YTD in this submarket.

Galvin also noted, there are minimal concessions in the West Loop or really any other submarket. Most Lease-Ups, including two in Fulton Market/West Loop, have been offering 1-month of free rent. There have not been any concessions offered on renewal leases and we are seeing lease trade-out increases of 15-20%, burning off all pandemic concessions.

Concessions will remain a part of the landscape during the lease-up but data is proving the market can absorb these gross rents.

Future Pipeline

“With current fundamentals stronger than ever, developers and capital partners are ready to invest in the city of Fulton Market,” Galvin said. “We’re entering a period of significant growth.”

In total, there have been roughly 4,000 Class A units delivered to this submarket since 2016.

In total, LLCR projects ≈10,000 new units added to this submarket in the next 3-5 years. This would be 28 new multifamily properties added to West Loop/Fulton Market.

Galvin concluded with the following:

“No one year is going to overwhelm this market. A popular Chicago neighborhood like Fulton Market can absorb 2000, even 2500 units in one year. Everyone can be successful here”

Real-Time Pipeline

If you are interested in access to the only real-time Class A pipeline in the market, please click here and provide your contact information.

Luxury Living Chicago Realty Adds 25 Team Members to Meet Luxury Apartment Demand, New Business Lines

Posted on June 22, 2022June 22, 2022 by LLCR Team

Following exponential apartment demand and growth Luxury Living Chicago Realty (LLCR), an award-winning real estate brokerage and multifamily marketing, leasing, and development firm, announces recent promotions and the addition of 25 new team members.

“We have always been at the forefront of Chicago’s luxury apartment market. With many apartments currently achieving rents well above pre-pandemic levels and limited supply in 2022 and 2023, Chicago multifamily fundamentals have never been stronger,” said Aaron Galvin, CEO and Founder of Luxury Living Chicago Realty. “Our approach to marketing, pricing, and renewals for Class A apartments is helping developers and owners capture top of the market rents and be positioned for future rent growth. In addition, our experienced broker team coupled with our market intelligence, helps renters feel comfortable with their home selection.”

Business Growth

Propelling the firm’s growth are suburban marketing and leasing assignments, renewal management, and multifamily development.

LLCR has approached new leasing assignments in the suburbs with the same professionalism and strategy employed across 50 previous leasing assignments throughout downtown Chicago. With three projects over 50 percent leased at the highest rents in the suburbs, LLCR expects future suburban marketing and leasing assignments.

In adding renewal management, LLCR has helped owner operators increase net rents upwards of 20 percent, while also improving retention rates above historical averages.

As a co-developer on a mixed-use development at 218 E. Grand, a 21-story building in Streeterville, LLCR is partnering with Mavrek Development and GW Properties to bring the first Class A multifamily development to the Streeterville submarket since 2019. Additional development opportunities are expected from LLCR.

“As our team continues to win exclusive marketing and leasing assignments, not only downtown but in the suburbs, there is an ever-increasing need for support,” said Galvin. “By hiring, training, and nurturing talent now, we will be prepared for continued increases in supply over the next few years. Securing the team now is an investment for today and the future.”

Team Expansion

Since January 2022, a total of 25 new team members have begun working at LLCR. Team members include a mix of operations, accounting, and leasing professionals supporting the firm’s exclusive marketing and leasing assignments, including One Oak Brook Commons, Highpoint at 8000 North, Cadence, Wolf Point East, Wolf Point West, and River City.

“Over the past few years, we have been intentional in our efforts to create an empowering and inclusive culture at LLCR. We’re seeing the benefits of these initiatives with minimal turnover during a period of significant growth,” said Galvin.

Team Promotions

In addition to new team members joining the company, there have been a number of notable leadership team promotions within LLCR:

Co-Founder Amy Galvin has transitioned from Managing Partner to Chief Culture Officer. In her new role, Galvin will focus on company culture, people operations, and team member wellbeing.

Chris Faye has been promoted from Director of Operations to Managing Director. Faye is tasked with overseeing the continued growth of the brokerage and further scaling the operations of the company.

Tamara Hirsch has been promoted from Senior Portfolio Leasing Manager to Director of Portfolio Leasing. As new product lines are added to the LLCR portfolio, Hirsch oversees all leasing activity and team dynamics.

LLCR continues recruiting efforts and is always looking for talented individuals to join the team. Learn more about available positions at http://www.luxurychicagoapartments.com/join-our-team.

Class A Luxury Chicago Apartment Market Update – February 2021

Posted on February 1, 2021February 2, 2021 by Aaron Galvin

Hello Clients, Colleagues and Friends,

Prior to 2020 every panel, article, or conversation about the Chicago apartment market turned to some variation of “how much higher can rent prices go”? With an average of 3-5% rent growth annually for the better part of a decade, it had to stop at some point. And in the second half of 2020, it did. According to Integra Realty Resources, net rents in the Class A apartment market in Q3 2020 decreased by 18.4% as compared to Q3 2019. And while Q4 data is not yet finalized, it’s safe to say those numbers are going to be even lower. Apartments that used to rent over $2,500 per month were priced $500 – $1,000 lower last quarter. Needless to say, nobody will soon forget the challenges from the second half of 2020.

2020 Positive Trends

That said, I am taking a different perspective looking back at 2020. At Luxury Living Chicago Realty (LLCR), we had our best year ever on a leasing volume perspective and outperformed the market by 10% on a net rent basis in Q3. When Q4 data is released, I anticipate we will come out about 15% higher. That’s not to say we did not see significant year-over-year rent decreases, but when we had to lower rents, we did so with a continued focus on market intelligence and a strategic approach to the long term outlook for our rental properties.

In addition to leasing volume, here are three key metrics we tracked at LLCR that provide confidence in the short and long-term outlook for luxury Chicago apartments.

Lease Terms:

While the market did see significant rent decreases, at LLCR we have placed an emphasis on long-term leases since July 2020. These are leases 18 months or longer.

With an expected recovery beginning materially in 2022, we have now positioned our portfolio to maximize rents at this time.
With a narrative of urban flight, we wanted to provide evidence of renters’ long-term outlook on downtown Chicago. Regardless of price, if renters did not feel safe or believe in downtown Chicago, they would not have committed for an extended period of time.

The result was that we leased over 750 units since July with a lease term of 18 months or longer. This was up 35% compared to 2019, and we feel confident this was the right strategy for our developers and owners.

Renter Income:

Renter income remained relatively unchanged in 2020. The average income for the Class A Chicago renter in the LLCR portfolio in 2019 was $106,549 and in 2020 it was $108,471. This is important to note because even with price decreases, rent payments now make up exponentially less of a renter’s income, leaving additional funds for travel, culture, savings and most importantly, future rent increases. This remains a financially healthy renter base.

Relocation Traffic:

One of the driving forces for downtown Chicago’s growth over the past 10 years has been relocations. During this period the downtown core has grown exponentially, absorbing nearly all of the new apartments delivered. LLCR data from 2020 did not see a decrease in relocation traffic. As compared to 2019, we had an equal 40% of leases categorized as relocation. These are renters moving to downtown Chicago for work, school, or the opportunity to try a new city while working remotely.

With the vaccine imminent, larger employers plan to return to work in the second half of 2021. This should fuel even stronger relocation traffic by Q3 and the next couple of years.

2021 Positive Trends

As we now have a full month of data from January, I can confidently say we hit the bottom of the market in Q4 and things are trending in the right direction. Since a low in November, where the average net rent in the LLCR portfolio was $1,846, we rebounded in December to an average net rent of $1,944. January net rent MTD was $2087. Each week rents are increasing 1-3%. In addition, velocity is way up! In January the LLCR portfolio had over 300 rentals. This is up 97% from January 2020 and better than ANY month we had in 2020. The spring leasing season has come early, and it’s time for us all to band together to strategically bring this market back to prominence.

In that light, I will be hosting the first ever Chicago Luxury Apartment Market Update on March 3rd from 4:00 – 5:30 PM. This virtual event will feature a even more LLCR data from 2020, a one on one Q&A with a recent Chicago renter, and a panel of seasoned and well-respected luxury multifamily developers discussing the day to day challenges of meeting Class A renter expectations and preserving value in a continued pandemic environment.

Sign Up For The Virtual Event Here

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