Pensam Capital purchases Butterfield Oaks apartments in Aurora from local developers Tony Rossi and Tom Moran

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Pensam is part of the crowd that has stocked up on apartments in the Chicago suburbs. In August, the company paid $ 30.7 million for Aspen Place Apartments, a 416 unit property in Aurora, and $ 13.0 million for Lakeside Apartments in Wheaton, with 204 units. In total, Pensam owns more than 3,400 apartments in the Chicago area, most of them in the western suburbs, including Naperville, Woodridge and Downers Grove.

Expect the company, which has invested more than $ 3.5 billion in 35,000 apartments across the country since its inception in 2009, to source even more apartments in suburban Chicago in the year. next.

“We plan to be very active in 2022,” said Michael Stein, founding partner of Pensam. “We really like the stability of the Midwestern markets, especially the western suburbs. “

Rossi and Moran developed Butterfield Oaks, a 23-acre property in Butterfield Road and DuPage Parkway, over 20 years ago. They decided to sell the complex because their partner, a Japanese investor, wanted to cash in, said Rossi, president of Itasca-based M&R Development.

Investors are also paying for suburban multi-family properties these days, so now is the time.

“We thought the prices were currently quite attractive,” said Rossi.

A Pensam company paid $ 83.8 million, or about $ 249,000 per unit, for Butterfield Oaks, according to a deed filed with DuPage County. Peter Evans, Senior Managing Director of Berkadia Institutional Solutions, led the brokerage team that organized the sale.

Stein isn’t put off by the high prices of suburban apartments these days.

“You really have to be convinced that the rents will continue to rise,” he says.

Grow up they have. Median net apartment rent in the Naperville / Aurora market reached $ 1.74 per square foot in the third quarter, up 15.5% from the previous year, according to Integra Realty Resources, a company of assessment and counseling.

Stein also believes the prices in the western suburbs are still reasonable compared to the cost of building a new apartment complex there.

Pensam sees an opportunity to further increase the value of Butterfield Oaks by repairing the property and increasing rents. Planned upgrades include new stainless steel appliances and flooring inside the apartments and new roofs and landscaping outside, Stein said. Pensam plans to spend “several million dollars” on the renovations, he said, declining to be more specific.

M&R, meanwhile, is busier these days building apartments in Wisconsin. The company recently completed large projects in Madison and St. Francis, just south of Milwaukee, Rossi said. M&R is also preparing to innovate on a development in Wauwatosa, just west of Milwaukee.

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