News
Condo Conundrum
September 19, 2012
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| The weak economy is not the reason the Ritz-Carlton Residences - Chicago, Magnificent Mile is still unoccupied. This one is more of a legal dispute. Prism Development Co‘s Margo Dahmani declined comment on the legal battle with the Terra Foundation of American Art but says the buyers should be able to start closing any day. On Friday, Cook County Circuit Judge Mary Mikva issued a ruling that favors Prism, the developer of the $220M, 40-story tower selling units priced from $1.4M to $12.7M. | |
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| Terra CFO Donald Ratner says occupancy could be further delayed while the non-profit pursues its claim that Prism hasn’t satisfactorily completed construction work on the 14k SF of offices that Terra will occupy and the 18k SF of retail space Terra has leased to Tommy Bahama and Ann Taylor Loft. Terra, which owned the prior building on the Ritz site, has agreed to sell its property interests to Prism for about $17.5M in cash. Terra will use the rents for grants to museums and academia. | |
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| It’s a frustrating conundrum for all parties, says Appraisal Research VP Gail Lissner. Only two new condo buildings— both luxury— have been delivered downtown this year, The Ritz Residences and Lincoln Park 2550. By mid-year, developers closed on 295 new condo sales, versus 770 for all of 2011 and 1,700 for 2010. Very little developer product remains and much of that is in the South Loop at Museum Park. But, she says, the resale volume of existing condos is up compared to last year, while prices have stabilized, signaling an improvement in the market. A remaining thorn: many distress sales of bank owned units. |
