CEDARst Cos. has received a $49 million loan for the redevelopment of the former Salvation Army Freedom Center in Chicago into a 260-unit FLATS-branded apartment community and ground floor retail. Dubbed The Duncan, the property will also include a restaurant and a local bike shop with a cafe.
Berkadia facilitated the financing, a non-recourse renovation loan, through Granite Point Mortgage Trust Inc.
“The financing was unique in that Berkadia was able to find a one-stop shop to finance the renovation at 79 percent LTC and on a non-recourse basis,” Michael Slovitt, Berkadia’s director, told Multi-Housing News. “Typically, at that leverage level, a borrower needs to bring in a bank at 60-65 percent LTC and fill the rest of the capital stack with mezzanine financing. By finding one lender it also decreased the time to get to closing and saved the borrower on transaction costs.”
When completed in 2020, The Duncan will include an activated lobby boasting a coffee shop, community lounge and bar.
The development will also feature a number of hospitality-quality amenities such as a fully restored basketball court and track, along with a swimming pool in the basement. Beneath the basketball court, there will be a full-size fitness center with cardio and weight machines.
“Outside, there will be over 8,000 square feet of green space, which is overlooked by a mix of private and public roof terraces,” Slovitt said. “Residents will be able to entertain friends, relax, and workout without ever leaving the building.”
A Booming Medical District
Located at 1515 W. Monroe St., the building is situated just a few blocks from the largest urban medical district in the U.S., which encompasses 560 acres of medical research facilities, labs, four major hospitals, two medical universities and more than 40 other healthcare-related facilities. The property is also nearby the popular Fulton Market neighborhood.
“The Fulton Market neighborhood has seen a population growth of 50-100 percent over the past four-year period,” Slovitt said. “Residents will enjoy the short distance from the Loop for a quick commute, while not being engulfed by towering high-rises.”
In addition to several employment centers situated within walking distance from the building, the residents will have access to restaurants, bars, and boutique shops in the neighborhood.
“Besides the location, the appeal of the property will be its character,” Slovitt said. “CEDARst Cos. is transforming two brick buildings over 100 years old with rich history—previously a YMCA and YWCA—and most recently used by Salvation Army for a community center and housing. It is rare for renters to have the opportunity to live in a brand-new building that dates back to the early 1900s.”
“We are excited to bring the FLATS brand to another great neighborhood of Chicago,” said Will Murphy, CEDARst Cos.’ managing partner, in prepared remarks. “This asset is straddled between the Medical District and Fulton Market and will offer a more affordable rental option than other recently-constructed apartment projects.”
Earlier this month, Berkadia facilitated the $33.2 sale of Park Plaza Apartments, a 234-unit community in North Miami, near the Golden Glades interchange.
Image courtesy of Berkadia