November 04, 2020 11:00 AM
A rendering of the apartment building Bond plans at 1140 W. Erie St.
Chicago developer Rob Bond is getting ready to break ground on a 113-unit apartment building in West Town after lining up financing for the $40 million project.
Bond said he’s secured about $14 million in equity financing and a construction loan of $25.6 million from Wintrust Bank for Inspire West Town, a nine-story development at 1140 W. Erie St., just west of the Kennedy Expressway. He aims to start construction in January.
Apartment construction here has slowed drastically since the coronavirus pandemic swept into Chicago and the economy slipped into recession. Downtown multifamily rents and occupancies have dropped as much of the workforce in the central business district has shifted to remote work, removing a reason for people to live close to their offices. Some tenants have left the urban core in search of space and safety.
But Bond hasn’t lost his faith in the Chicago apartment market. He expects it to look quite different by spring 2022, when Inspire’s first tenants would start moving in.
“I believe multifamily will recover very strongly when we get a vaccine in the next six to 12 months and people start wanting to have their own place again, instead of living with Mom and Dad,” said Bond, co-founder and president of the Bond Cos.
He’s also counting on people moving back downtown to be close to their jobs.
“Businesses want people together in their offices,” he said. “I think people are tired of Zoom.”
Designed by FitzGerald Associates Architects, the building will include studio, one-, two- and three-bedroom apartments, a fitness studio, two outdoor terraces and a workspace for tenants who work from home.
The Bond development venture also is acquiring 17 apartments on the West Side that are affordable to tenants below a certain income level. To obtain a zoning change from the City Council for the project this fall, Bond agreed to buy the off-site apartments under the city’s Affordable Requirements Ordinance.
Bond Cos. raised some of the equity for the development through Crowdstreet, a Portland, Ore.-based crowdfunding platform. The developer sought to bring in $12.6 million through Crowdstreet, which raises money for real estate projects in small amounts from individual investors. But it fell short of that target, with “friends and family” investors closing the equity gap, Bond said, declining to provide specifics.
Inspire West Town is just across the Kennedy from Spoke, a 363-unit apartment building at 733 N. Carpenter St. that Bond completed in 2017. While Spoke has suffered from the downtown apartment slump, Bond isn’t worried.
The building’s “not doing great, but it’s doing fine,” he said, declining to discuss specifics.
With just 113 units, Inspire is less risky than Spoke with a similar advantage in location, near the CTA Blue Line and not far from the trendy Fulton Market District.
“It’s got great demographics, and it’s really close to the Loop,” Bond said.