Rents on The Residences

The Residences is the new Cron Management 8-story development nearing completion, with Hop-Cat on the ground floor.

The apartments are now being marketed and, along with Cron Management's earlier Stonehouse Village brownfield, probably provide a better picture of high-end student rentals than St. Anne Lofts, which have small square footages for number of bedrooms.

One reason The Residences is of interest is because some of us are still advocating for exploring the possibility of a 55+ retirement community apartment building(s) option for the Park District, and The Residences provides a comparison, although for retirees, probably 1- and 2- bedroom apartments would be the norm rather than 2- and 3- bedroom apartments.

The Residences lists two floor plans for 2-bedroom apartments, 1265 sq. ft., 2 baths, and 1096 sq. ft., 1.5 baths. These cost $1700-$1850 per month, or $850-$925 per bedroom. This works out to about $18 per annual square foot.

Three bedroom apartments cost $2400-$2550 per month, or $800-$850 per person, although there is only one floor plan shown, 1371 sq. ft, 2 baths. (Prices may vary depending on floor.) This works out to about $22 per annual sq. ft.

By way of comparison, a 1000 sq. ft. 1-bedroom apartment at $1200 per month would work out to about $14.4 per annual square foot. It would take $1500 per month the reach the $18 per annual square foot figure.

The bottom line is, if The Residences or its equivalent was a 55+ retirement building, with about 2/3 2-bedroom apartments at $2000 per month (about $20 per annual square foot) and 1/3 1-bedroom apartments at $1500 per month, the gross revenue would be just slightly lower than half and half 2-bedroom and 3-bedroom student apartments at the listed prices for The Residences.

$18,000 or $24,000 per year is a lot of money for most retirees, but it is reasonable for professional class retirees with $50,000-$100,000 per year income.

With boomers retiring, if I were an investor, I would rather take my chances on renting out 150 2-bedroom and 75 1-bedroom upscale apartments (more of less Lurvey-White plan 2 for the Park District) for seniors than the equivalent to students from wealthy families, especially since less parking would be needed.
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