Hadar Goldman is shopping his 1,700-unit Chicagoland affordable housing portfolio.
CBRE is marketing a Goldman Investments’ portfolio that includes 76 renovated buildings on Chicago’s South and West Sides and in the south suburbs. More than 80 percent of the tenants receive government-backed voucher subsidies for rent, and the units are 96-percent occupied. Brokers Justin Ross, Danny Byrne and Bill Howe have the listing.
Goldman’s price expectations based on in-place net operating income are about $200 million “but we shall let the market talk,” he said in an email. He said he is selling because of his company’s focus on renewable energy and technology.
There have been very few trades of portfolios this large in the Chicago area within the last several years, though the city saw one of its most sizeable multifamily deals late last year when New York-based Emerald Empire bought the Pangea Properties’ local portfolio of about 7,500 units across more than 400 buildings for over $600 million.
Though the Pangea deal is comparable in terms of scale, Goldman said his portfolio stands out from those apartments and other affordable housing portfolios in terms of quality. The apartments have been gut renovated in the last two to three years, he said.
Goldman is offering an assumable debt at an interest rate of nearly 4 percent, according to the listing, which could appeal to investors who have the cash but might have trouble making new deals pencil out due to interest rates topping 5 percent.
Recent Chicagoland deals and listings have used assumable debt as a selling point. Los Angeles-based ShainRealty Capital recently sold a 200-unit South Side multifamily portfolio in a deal that included assumable debt, and a 416-unit apartment complex in Aurora was put up for sale last month with below-market, fixed-rate financing.
Affordable housing is also a relatively stable investment, as demand for it isn’t susceptible to market shifts and Section 8 vouchers virtually ensure that landlords receive payment.
Goldman’s firm owns more than $500 million worth of Chicago-area and Texas properties.
The investment company completed two condominium deconversions in Oak Park in early 2020, buying the 56-unit Regency Terrace Condominiums and the 26-unit Clarence Court for a combined $12.4 million.