Developer Resurrects $100M Condo Plan

CHICAGO-A plan for a $100 million condo tower here in the West Loop has been resurrected, according to developer Gary Rosenberg with Urban R2 Development Co. Rosenberg tells GlobeSt.com that he has another lender willing to back the Catalyst project, after a two-year effort in which the former lender, New Jersey-based Kennedy Funding, foreclosed on the site.

Rosenberg says he has one entity to provide him the capital necessary to start construction on the project, though he claims he can’t divulge the lender. “I’m under a very tight and comprehensive confidentiality agreement,” he says. His background includes more time developing properties in the South than in Chicago, and he split with his only local finished project, the 40-story 600 N. Fairbanks Court, due to a “difference with one of the partners. After the project was well under way, we settled and got bought out,” Rosenberg says.

Catalyst, designed by local architect Lucien Lagrange, was unveiled in summer 2008, promising 220 units in a 22-story tower at 123 N. Des Plaines St., currently a parking lot. The building was to include studio, one, two and three-bedroom condo units as well as penthouses, with prices from $200,000 to more than $1 million. Walgreens signed a contract for about 13,000 square feet, with another 1,600 square feet of retail available.

Rosenberg says most of the original plan is still in place, though his company’s Web site for the development hasn’t been updated in months. The Walgreens is still a go, he says, and he has buyers for 75 of the units. If more people don’t sign up, he says the project was designed to be also marketed as an apartment building.

He says he’s ready to begin construction this summer, finishing in spring 2011. The money for the $8.7 million claimed by Kennedy will be paid with the new loan, Rosenberg says.

Assuming the construction goes further than a few other stalled towers that litter the city, a new condo building may be quite a draw without much competition if and when the market comes back, Rosenberg says. “I’ve been through a lot of cycles, I know how this works. It might be slightly different now, but it’s playing out the same, it just may take a little slower to rebound. There won’t be much on the market when we complete this project,” he says. Sales for condos have been particularly slow in a city that saw a resurgence of downtown buyers, about 4,000 units sold on average per year in the past decade, following the redevelopment of Millennium Park. Now, fewer than 600 units sold in each of the past two years, according to locally-based Appraisal Research Counselors.