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Jan. 24, 2013

ST Residential LLC Puts 326-unit Lex up for Sale

By Gabriel Circiog, Associate Editor

Chicago-based ST Residential LLC has hired brokers Holliday Fenoglio Fowler and Eastdil Secured to manage the sale of a 13-property portfolio with an estimated value of close to $1 billion. The multifamily properties, which were part of the failed Corus Bank condominium portfolio acquired by the venture, are located in Atlanta, Chicago, Houston, Las Vegas, Los Angeles, Phoenix, Stamford and Tampa.

ChicagoRealEstateDaily.com reports that the portfolio includes the Lex—a 326-unit condo-turned-apartment tower located in the South Loop at 2138 S. Indiana St. The 35-story tower was built by Chieftain Group Ltd., and by the time the project was completed in 2009, the condo boom had ended—leaving the developer with dozens of unsold units.

Chieftain was unable to pay off a construction loan to Corus Bank and relinquished the property to ST Residential LLC in 2011, which converted the high-rise to apartments. According to a report by Chicago-based consulting firm Appraisal Research Counselors quoted by the same source, the Lex was 75 percent leased at the end of the third quarter. ST Residential is a manager of properties owned by a public-private partnership between the FDIC and a group of leading U.S. private real estate investors.

Barry Sternlicht, chairman and CEO of Starwood Capital Group and chairman of ST Residential, said: “The Corus Bank transaction has performed extremely well for the FDIC and our private investor group. The partnership has repaid $1.3 billion of FDIC purchase money notes and has more than $1 billion of cash in hand. More than 32 loans were paid off at par, and we have sold 60 percent of the condo inventory we acquired at ever-escalating prices.”

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Photo Courtesy of: www.stresidential.com

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