Crain’s residential real estate reporter Dennis Rodkin talks with host Amy Guth about news from the local housing market, including a Lincoln Park mansion sale marking the second-highest price in the city so far this year.
Plus: State Farm braces for losses from Hurricane Helene, Boeing weighs raising at least $10 billion selling stock, local venture pays $93 million for Fulton Market apartments and University of Chicago's business school gets $60 million donation.
Bloomington based state farm braces for losses from Hurricane Helene. And I'll talk with Crane's residential real estate reporter Dennis Rodkin about news from the local housing market including about a Lincoln Park mansion that sells at the second highest price so far this year. Came on the market in July at 15 million sold this week for 14.25 million the time from going on the market to going under contract is 50 days. The highest price sale of the year so far is a little over 15 million for a house on Burling. That one you can compare to this one on Dickens was on the market for eight years. I'm Amy Gooth and this is Crane's Daily Jist for Thursday October 3rd. When I dive deeper into the topics you've heard here read the full stories and get access to all of Crane's award-winning coverage with a Crane's Chicago Business Subscription. Crane's Daily Jist listeners can get 20% off a one year Crane's Chicago Business Digital subscription by visiting ChicagoBusiness.com/Jist and using promo code Jist at checkout. Once again to redeem this offer visit ChicagoBusiness.com/Jist and enter code Jist to get this deal while it lasts. I'm joined by Crane's residential real estate reporter Dennis Rodkin here to talk about news of the week from the local housing market. Hi Dennis how's it going? Good Amy how are you? I'm well thank you. Let's start with a story that I have seen all over social media and that is all about Caleb Williams tell me about what's going on. Well yeah I think what you saw all over social media was the opposite of our story right? I mean it's fascinating I have spent much of my career reporting that ballers CEOs bought a house or sold a house. This is one of the very few times I've reported that somebody did not buy a house. This is really fascinating. Caleb Williams as everyone knows is the new quarterback for the Bears. Yeah. Suddenly Friday and Saturday was the subject of quite a rumor all over the internet it was reported that Caleb Williams had purchased a $12.99 million house on the lakefront in Lake Forest. This was in Sports Illustrated's website it was in Barstool Sports it was everywhere. I tell you Amy on Saturday I was out doing non-work things and I had texts I had tweets I had emails saying oh my god Caleb Williams bought this house in Lake Forest and I thought well that doesn't seem likely for a lot of reasons but I ended up researching it and on Monday we reported that in fact Caleb Williams has not bought a $12.99 million house in Lake Forest. Let me there are 17 caveats here and one of them is he could still end up buying this house. Okay. There is a possibility that what was happening was he had put in an offer on the property and somehow it got out that he had bought it but the primary reason to think he hadn't bought it is it's still on the market. It's a $12.99 million mansion on the lakefront in Lake Forest and the word I got from the listing agent was we do not have it under contract it is actively for sale and he said we were actually dealing by email early Monday morning he said and I don't know of any source who can tell you otherwise. Okay. Which is to say there's not somebody who could say oh we've got an offer in on it. So once again going back to the caveats it's entirely possible that the property just isn't at a contract stage yet that an offer hasn't been made and I say that just because you know I don't want to have egg on my face down the line when I say no he hasn't bought it and it turns out he did buy it. But what we do know is for sure all these articles were stating as fact he bought this property we know for sure he has not bought this property and as I said the the agent said no it's still actively listed. In fact what he told me is on Thursday last week's Thursday it was part of a big benefit for the school district in Lake Forest where he said over 500 people came to see it. That's the same day that the first report went out that Caleb Williams had bought it. I don't know what's going on here and I don't want to speculate on whether somebody has made up a story or somebody has a far better tip than I have which of course would embarrass the heck out of me. But the one thing we know is the property has not been sold yet and is being actively marketed. Now it's very interesting first of all these articles were saying that he has bought the property and if you look at them some of them also say that he previously purchased a big apartment downtown a big condominium in the loop. Here's what's interesting about that. Both this Lake Forest property and this downtown apartment he has supposedly bought were in a story that I wrote when Caleb first signed with the bears. There had recently been a report out about how the mansion market is a lot easier in Chicago. You get a lot more for your money up at the upper end they did a lot of other cities. So Caleb Williams signs and I compared this city's mansion market to other cities he might have signed in and I said in here are some places he might buy. Two of the places I said he might buy were the one he's now rumored to have bought and that we're quite sure he didn't or a condo downtown on Michigan Avenue that was also my story. So the reason I say that is not a look I have powers of seeing the future because I'm quite sure I don't. But I do think that it's possible that somebody misread a story that said Caleb Williams could buy these as saying he's bought them. Right. Sure. Well we will as I often say with you put a pin in that story and come back to it when we know more about that. Speaking of of mansions in that price range tell me about a Lincoln Park mansion that sold pretty quickly up in the 14 million dollar range. Sold in 50 days. Wow. Or approximately 50 days. There's a mansion on Dickens. I wrote about it in July when it was about to come on the market. And so it's 50 days from the day I wrote about it until it went under contract came on the market within a few days of my article. Really nice place. I said at the time it's not as opulent as you would expect for a place that's listed at 15 million dollars. And we'll talk a little bit about what it looks like but came on the market in July at 15 million. Sold this week for 14.25 million. It had been under contract for quite a while. The time from going on the market to going under contract as I said was 50 days. The highest price sale of the year so far is a little over 15 million for a house on Burling. That one you can compare to this one on Dickens was on the market for eight years as opposed to 50 days. Michael Jordan we recently talked about in Highland Park. His mansion there was on the market for 12 and a half years. It hasn't yet sold but it is under contract after 12 and a half years. Ken Griffin has a penthouse in the park tower the 67th floor of the park tower for sale at 15.75 million since July 2022. There's a giant estate in Lake Bluff at almost 20 million that's been on the market since 2018. So I've rattled all those off as a way of saying 50 days for a 14 million dollar sale is pretty impressive. Not entirely surprising because this place is so nice when I walked through it in July I was fascinated. This couple who built it they built it about a decade ago. They were a family of five. They lived nearby in Lincoln Park. They wanted something larger but they didn't want something they said to me specifically. We didn't want something that said look at us. They wanted something they they called it sort of their haven their sanctuary. It has a courtyard but when you're looking at it from the street you think you're looking at multiple buildings. The way they did it it looks like multiple smaller buildings in the neighborhood doesn't really have the grand palatial stairs very comfortable. I hate to say like a Northwoods house because I mean it's a city mansion but it has a lot of rusticated wood. It opens out to the courtyard from a lot of rooms. It has several outdoor spaces on several levels but that includes a big rooftop deck where you look toward the skyline you also look down over the courtyard of the house. It's really it's very different from a lot of the ostentation that we see in some of these other mansions. For instance the one that took eight years to sell looks like a palace. Yeah sure. That's the one where they famously brought in French gravel for the driveway and all that sort of thing. This house is very different. I don't know that that's why it's sold so fast. Once it's sold none of the agents who determine a call and I no longer have contact information for the sellers so I don't know that what I've just said is the reason it's sold quickly but I do know that it's not a surprise that it's sold quickly given all those kinds of finishes I talked about. It's location sort of heart of Lincoln Park with the park just a few blocks away and just a ton of outdoor space that has privacy. You've got this big courtyard and yard and fountain that are off the street. It's a pretty cool house and if I didn't say this it's the second highest sale of the year so far in 2024 not only in Chicago but in the Chicago metro area. Yeah I can't believe it's already we're already into October so soon we're going to be kind of starting to think about what you know those those year end totals which I feel like we were it was just the start of the year but here we are moving towards the end. Yeah my spreadsheet is filling up you know I tracked those during the year. This is the second sale we've had this year over 10 million dollars. Yeah by this time in 2022 there had been six sales at over 10 million dollars and in 2023 I think it's four. Well we will see what the last quarter of the year brings. Well speaking of high ticket houses we're gonna leave Chicago for a minute. We're gonna go to LA talk to you about Tony Pritzker's LA mansion reportedly priced at over 150 million dollars. That's a whole other level right there. Yeah doesn't that look like a typo? Oh did they need the type 1.5 million? Right. Yeah Tony Pritzker is the brother of Governor J.B. Pritzker and of Penny Pritzker who was the US Commerce Secretary. They both of course are in Chicago now but as far as I could tell Tony Pritzker like J.B. Pritzker grew up in California. Anyway with his wife Jeannie Crieser Pritzker who did grow up in the Chicago area he built a house on a hilltop in Los Angeles that is known as one of the biggest houses in Los Angeles if not in America it's gigantic. It looks like a ship or it kind of looks like a couple of ships parked on the top of a hillside in an area known as Beverly Hills Post Office which I think is a hilarious name for a neighborhood. You know we've got places like Pilsen they've got places called Beverly Hills Post Office but this house is gigantic. So the reason the value of it has come out is that Tony and Jeannie Crieser Pritzker finished the house in 2011. Apparently it was a place where major political fundraisers happened all sorts of galas and things like that but for the past several years the two owners have been locked in a very contentious divorce. We got a lot of this from the Wall Street Journal. It turned out when Tony moves out of the house his soon-to-be ex wife Jeannie finds out that she doesn't actually own part of the house that it's been owned in a bunch of trusts. Sure. And she has told specifically you're not a beneficiary of the trust. So then there's a whole lot of legal wrangling which apparently now has settled and she has left the property and it's coming on the market imminently according to the Wall Street Journal and it will be priced according to their sources at over a hundred and fifty million dollars perhaps as much as two hundred million dollars. I have no words Dennis that is just an astronomical amount of money for a house. Yeah that's 10 Lincoln Park mansions right that's. I mean usually here at cranes when we're talking about those kind of dollars we're talking about bought a business yeah bought a skyscraper not usually a residence that's so significant well well it's LA billionaire real estate right I mean yeah right different level yeah they clearly I mean I think like a lot of people they built this intending to have it for a very long time I don't think you build a house of this scale in 2011 thinking that in 13 years it'll go on the market but right they had a divorce and as a lot of people find after that you end up getting rid of for example your dream house or in this case your dream gigantic house your dream palace yeah indeed indeed all right well let's move from one political family to another and talk about Michelle Obama's family home in south shore and what's happening with it boy and the only thing these two houses have in common is the political families because this is a far more modest property this is a bungalow in south shore many people were aware that this is where Michelle Obama grew up it's a classic Chicago bungalow that was built with living on the first floor an expansion space in the attic well that attic was turned into an apartment and that's where Michelle and her brother were raised by their parents this bungalow was bought by Michelle's great aunt and great uncle I found in the records in september 1965 it was in the family from 1965 it passes from the great aunt and uncle who live on the first floor and Michelle her parents and her brother live on the second floor they bought it in 1965 and it passes from them to Michelle's family in 1980 in 1991 Michelle's father dies and it passes to her mother in 2009 Marianne Robinson Michelle Obama's mother moves into the White House with her son-in-law daughter and grandchildren and says I'm only gonna be her temporarily this is a nice house she says of the White House but I like my house better and so that's January 2009 she's in People magazine and as far as I can tell she never does come back she stays in the White House and then my understanding is she lived with the Obamas in their post-presidential home and as most people know she died this year yeah after she died I learned that while she had still owned the house for a very long time in 2020 it passed from her ownership to the Obama Foundation I found this out only recently even though it happened in 2020 so I check in with the Obama Foundation and of course it takes a little bit of time but what they did is they said yeah we do have it there's not a purchase price in the records but I found from the Cook County Assessor that it's valued at about $160,000 I don't know what the Obama Foundation paid if anything but this is a modest bungalow in South Shore with a huge amount of history in it yeah so what they said is we do have plans we don't know what they are we're trying to get the Obama Center built first and then the plans for this building will be made later the bungalow is about two miles from the Obama Center and you can see it as I can see it as sort of an example of what happens in this country this woman Michelle Obama grows up in the finished attic of a South Shore bungalow she's super smart she gets a great education she goes to two great schools as we know she ends up married to somebody who's super smart who's on the political rise ends up as she ends up as the first lady of the United States of America coming out of that little bungalow to me that's a great example of sort of the escalator that people ride in this country Michelle Obama is super intelligent raised in very difficult circumstances apparently although she said in a video tour of the property years ago when one of her books came out she stood up front and said I cannot believe that a family of four lived a full life up there pointing at that attic at this the attic of a bungalow in South Shore and she ends up as this very famous figure very prominent person with a husband who has been on the world stage now for years I can see it as sort of an exhibit related to that although the Obama Foundation didn't ask me what I want to do with it who knows that they don't you know use it as a guest house for visiting dignitaries or or whatever else we'll see what happens but the basic news here is that bungalow was in her family until 2020 and now is in the hands of the Obama Foundation you're exactly right you know to add to kind of here's the story of the the little girl the group in the attic yeah right and like in this finished apartment and and all that she has gone on to do with her life yeah you know we we talked quite a bit over the course of the past few years of what we called the Black House movement where a lot of these homes were being preserved the home that Emmett Till lived and etc Muddy Waters's house is a historic landmark in part because a lot was happening there in his house this house fits right into that in part because I keep saying Michelle Obama grew up in that house but the other thing is Barack Obama lived there briefly as well when they were first married they lived in that attic her mother had already moved downstairs to the the main apartment on the first floor and we were just talking about one of their early marital residences that condo yeah just a week or two ago yeah yeah interesting it on the map of the Obamas we've had two properties just in the last few weeks right all right well two other stories I want to talk with you about we have one in Evanston and one in West Englewood where would you like to go first well we're in the south we're on the south side why don't we go to Englewood first let's do that tell me about this school that is now slated to become affordable housing back in 2013 most people remember the ramen manual administration closed 50 schools that left 46 buildings empty here we are that was 2013 here we are in 2024 and one of those is becoming affordable housing many of the buildings have been put back to use but some like this one in Englewood have sat empty all this time there's a Wisconsin developer of affordable housing which has a specialty in old schools they've converted schools in Madison Milwaukee, Moline, Illinois other places into affordable housing and what the one of the principles of the company the gourmand company told me is they've been wanting to do it in Chicago there are all these empty schools there were some delays on the particular building they were working on and there were also delays having to do with COVID other schools have been turned into affordable housing over the over the years also into market rate housing this firm was a little bit delayed but they're now turning this building that has sat empty since 2013 into 50 apartments it's the Earl school and it's kind of fascinating to think that this was you know a community anchor the Chicago public school buildings all over the city were community anchors and then the lights went out and now the lights are coming back on this building is being reactivated one of the reasons they focus on schools is he said you know the square classroom of a late 19th early 20th century school building is just right to be a one or two bedroom apartment they also have big windows that bring in a lot of light you have a central corridor for people in the different apartments to pass through and the other thing is it's an existing building rehabbing it existing building is relatively inexpensive compared to building new so they've done this all over and as I said wanted to do it in Chicago or just now getting started we've talked in the past I've written in the past about developers who've done this not as affordable housing as market rate housing in uptown in noble square it's really interesting to see these buildings come back it's slow going again can't say too many times many of these closed in 2013 that's a long time ago but it's nice to see them come back it's nice to see this one in Englewood to become an active piece of the community which it had been for a century yeah definitely plus I think there's just something kind of special and cool about the idea of a school building becoming housing I was I'm thinking of particular the one that we talked about in noble square that that kind of retained some touches of this kind of school feeling in it and I just think there's you know such fun energy in schools anyway and so to turn that into housing is I think that's lovely they're doing some of that with this one there is there are built ins a lot of built ins in the classrooms that are being taken out restored and put back into the classrooms flooring wanes coating things like that but one thing the developer told me is in most of the buildings they work in there's an old trophy case and if there aren't old trophies they go out and get some for whatever reason this school didn't have a trophy case so one of the classic things you expect to see as you walk down the hall of an old school for some reason was not in this one I have no segue to the next thing I want that school to have a trophy case now I feel like we need to make some trophies for this this place that's going to have new life as this building well I'll work on that another time I'm glad you have a mission Amy I do all right well now let's go to Evanston and here's another example of putting vacant space back into use tell me about this one yeah boy talk about reactivating a community anchor this is the Harley Clark mansion which is on the lake front at Evanston for people who don't know it's north of north western university in a more residential strip of the lakefront beautiful old building built in the 1920s and we've talked about it several times this has been empty since 2015 built in the 20s for a long time for I think two decades it was the headquarters of a national fraternity then for 50 years it was the Evanston art center when the art center announced it would move out in the 20 teens the city started looking at uses for this building the city owns the Harley Clark mansion this beautiful absolutely gorgeous stone mansion on the lake you go behind the mansion and you go down over dunes to the water it's really a special place so they've been trying to get it filled again since 2015 a couple of things that have died there were another prince another Pritzker family member colonel Jennifer Pritzker tried to turn it into a hospitality venue a hotel at the time she had a couple of bed and breakfast and Evanston and the idea was this would sort of be a piece of that portfolio that got voted down later a novelist was trying to start something called the American book center and as we talked about early in 2024 that failed because she couldn't raise the money that was required to get this thing going so in January Evanston said okay we're going to take proposals again starting this process over of trying to fill it in and remember they voted down Jennifer Pritzker's proposal primarily on the idea that it was a commercial use of this publicly owned building so January they asked for proposals May they take them in late September they're getting ready to announce that the city officials want to endorse one of these three proposals which has a strongly commercial element to it word gets out into Evanston and there's a little bit of a hullabaloo and then the city decides well we'll release all three proposals so all those three proposals are now out there one the one that was going to be endorsed had a hotel element just like the Jennifer Pritzker program has a bourbon bar and speak easy in the basement has a wedding venue another is similar no hotel use but events and other things and the third is kind of a community center with with multi-uses theater dance craft fairs health classes exercise classes all sorts of things all going on in the building like a community building in almost any other town there are also other community buildings in Evanston so what we don't know is which of these three will prevail it's all to be discussed in a coming meeting and what's likely to happen I think is that because there are commercial elements to a couple of these people who said years ago we don't want anything commercial in there may come back to say we still don't want anything commercial in there the leader of this one the most commercial proposal the one with the hotel rooms and the bourbon lounge said to me well I think you know enough time has passed that people have figured out if you want this building to survive and be taken care of you probably need a commercial use in there something that is generating cash and is worth a sizable investment the idea being a community center doesn't really support itself financially not that I'm endorsing one over the other I'm just trying to lay out the issues so this is the latest delay in the process when the city had to release these other proposals and I think that it leads to likely more delays as people hash out these three and the question of are you going to put a commercial use in this building that's been owned by the city for about 60 years yeah well let's put a pin in that one too and we'll revisit that when the time comes Dennis what is coming up in the week ahead I have a couple of big properties coming up the before it hits the market property is one of the most expensive I've written about in that column it's about a seven million dollar house interesting all right I will meet you right back here this time next week and we will talk all about it thanks so much Dennis that's great thanks Amy coming up University of Chicago's business school gets a 60 million dollar donation we'll talk about that and more right after this thanks for listening to cranes daily gist remember we provide a daily news brief that drops right in your inbox it's our newsletter called the cranes morning 10 they're the 10 stories that will fuel a smarter workday to subscribe visit chicagobusiness.com/morning10 this is the cranes daily gist with Amy goop state farm general insurance company and citizens property insurance company are bracing for the insurance industry's target losses from damage caused by hurricane haleen which is quickly becoming one of the costliest storms in us history bloomberg reported that state farm was the leading provider of home and car insurance in georgia and south carolina at the end of 2023 according to the most recent data from am best and a significant exposure in florida and north carolina the bloomington based firm said on september 30th that it had received more than 50 000 auto and home owner claims related to haleen and expects that number to rise bloomberg noted in reporting that in florida where haleen first made the land fall last week with winds reaching 140 miles per hour state-backed citizens is the state's biggest insurer it's received about 10 000 claims as of tuesday according to a company spokesperson but as bloomberg also noted the total of insured losses from haleen won't be clear for months at least the storm wreaked havoc from florida to ohio bringing catastrophic flooding and leaving more than 160 people dead and millions without power bloomberg further noted that an early projection from acue weather predicts the total economic damage a measurement that includes lost wages canceled flights and supply chain disruptions from haleen could hit 160 billion dollars making it one of the five costliest storms in us history by comparison hurricanes barrel and debbie earlier this year cost around 30 billion but insured losses may be far lower flood damage is typically excluded from standard property policies and homeowners have to buy additional coverage from a private insurer or from the national flood insurance program bloomberg pointed out in reporting that property owners in georgia and south carolina carry less flood coverage compared with people in florida which has been regularly impacted by storms relative to each state's economy florida has five times as much private flood insurance as georgia and almost 14 times the federal flood coverage according to bloomberg calculations on friday before haleens continued damage over the weekend core logic estimated insured losses up to five billion dollars am best projected at least that much if not more hurricane eon was the most expensive storm in recent years with insured losses higher than 50 billion dollars bloomberg reported citing people familiar with the discussions that bowing is considering raising at least 10 billion dollars by selling new stock as the plane maker seeks to replenish cash reserves depleted further by an ongoing strike the company is working with advisors to explore its options said the people asking not to be identified discussing confidential matters raising equity isn't likely to happen for at least a month assuming the plane maker can resolve the strike because bowing once a firm grasp of the financial toll from the walkout by 33 000 workers the people said bloomberg noted that a spokesperson for bowing declined to comment no final decision on timing and the amount has been made and bowing could end up deciding against the move according to the people but bowing is under pressure to shore up its finances and hold on to its investment grade credit rating the company is one step away from dropping into speculative territory which would further drive up the cost to service its 58 billion dollar debt load and the situation has been exacerbated by the strike now in its third week that has shut down the output of bowing's single-ile airliner as each day of the strike further dense reserves bloomberg also reported that the plane maker has seen its financial reserves dwindle in the wake of a near catastrophic accident in january that forced the company to slow production of its cash cow 737 max airliner should bowing proceed a sale of that magnitude would stand to be the biggest white public company since saudi arabian oil companies 12.3 billion dollars sale in june bowing faces a liquidity squeeze after burning through 8.25 billion dollars in free cash during the first half of the year the u.s. plane maker slowed work on the 737 max and other jets to address quality lapses brought to light by the accident on an aircraft on january 5th workers have now rebuffed two offers from the company for higher pay and the two sides have engaged a mediator to help overcome the impasse according to data compiled by bloomberg analysts expect a 3.36 billion dollar cash outflow in the third quarter from bowing and the strike stands to cost to the company about 1.5 billion dollars for each month that it remains unresolved according to estimates from jp morgan chase a local venture has acquired an apartment tower in one of chicago's hottest neighborhoods at a discount cranes rachel hertzog reported that a venture including chicago based jdl development and local investor john shryber bought the parker a 227 unit luxury apartment building at 730 west couch place in fullton market buying it from a venture of jp morgan asset management and atlantic residential the sale price was 93.3 million dollars according to property records and as hertzog noted in reporting that's down from the 111.4 million dollars that jp morgan asset management paid for the 29 story tower seven years ago in one of the priciest apartment deals of 2017 in the years since elevated interest rates have tempered sale prices for even well located commercial properties nationally sales of apartment buildings were down nine percent year over year as of august according to real estate information company msci real assets with prices down five point seven percent hertzog noted that jp morgan asset management also sold a street or ville apartment building at a discount in the spring hertzog noted that the parker was about 98 occupied with average lease rents of 367 per square foot when it hit the market in april according to a jones lane liselle bros shore marketing materials from the brokerage said a buyer could modernize some of the buildings fixtures to raise rents and bridge the gap between rates at the parker and more recently built apartment buildings hertzog also reported that downtown apartment building owners are poised to benefit from limited supply in 2025 and 2026 with just a few hundred new units set to be delivered appraisal and consulting firm integrity resources anticipates year over year rent spikes of five percent next year university of chicago alumni clifford aznes and trusty john lew co-founders of investment management firm aqr donated 60 million dollars to the university's booth school of business cranes brandon du pre reported that the gift will support the business school's new master in finance program which will be renamed the aznes and lu master in finance program the program welcomed its first cohort of students this year du pre noted in reporting that the 15 month master's program is intended for according to the university quote recent college graduates who want to build on quote analytical skills and allow them to start a career in finance with a competitive advantage over their peers the program along with the new master in management degree offering was announced in 2023 and marked one of the school's first new degree offerings in 88 years and du pre further reported that the gift marks the second large donation the university has received in the last week totaling a hundred and sixty million dollars in the span of just a few days on september 26th u chicago announced an anonymous donor gave one hundred million dollars one of the largest in school history to the college to support its continued practice of free expression and commitment to open dialogue that's cranes daily just for now check in on our continuous news feed at chicagobusiness.com thanks so much to today's guest cranes residential real estate reporter dennis rodkin you can follow all of our conversations on apple podcasts spotify or wherever you like to get your audio on demand don't forget to subscribe and please rate and review cranes daily gist our show is produced by tod manly at earsight studios i'm amie gooth thanks so much for listening and i'll meet you right back here next time
