Episode Transcript
[00:00:00] Speaker A: Foreign.
[00:00:06] Speaker B: Welcome Everybody to the 2026 Edgewater Uptown builders association forecast. Thank you guys all for coming.
I am Kate Vardy. I'm the president here at Yuba.
I just want to take two seconds and then I'll give it to the comedian.
I wanted to thank Joe and Andy for this great space. We not only get to enjoy a great panel, but great things to look at. The car is not wrong. We are a volunteer board. Work really hard to put on events like this throughout the year. So I'd like to just say thank you to our board members. Tracy Scanlon, Roger Daniels, Jacob Price, Ron Abrams. Our newest member, Garrett Lee, Alec Greenberg, who also has. I am going to be a one term presidency and Alec will be taking over as the president of Yuba. Will be co president this year and taking over next year. So congratulations to him. Little round of applause for Alec. Come on.
Thankless job.
And then one of the core missions for Yuba is giving back to the community around us.
This year we will be working with Care for Real, which is a hyperlocal charity that provides food and clothing for people within the Edgewater and Rogers park neighborhood. It is a great organization.
We will be donating our time to the food pantry in a couple of weeks and you will have board members reaching out to you and other people in the neighborhood to try and help raise money for this organization.
Yuva will be matching up to $5,000. So if you guys can, you guys will be getting emails and calls from us. Whatever you can do, whether it's time, whether it's donating clothing or whether it's your money, it's a great cause and there are a lot of people really struggling out there. So we appreciate anything you can do and without any more delays what you guys came here for.
[00:02:06] Speaker C: All right. Hi, I'm Ron Abrams and I'm gonna do a little intro and a couple more things.
Got most of it done for me. But this is our 10th annual forecast. Kind of 10th in a row. Maybe some of it was zoomed. Last year I had a little back problem. I wasn't here.
I'm happy to be back and not laying in bed in complete agony. So I pulled out an email from 2016 and our panel was Matt Jones from Kaiser Group, Matt Welke from Essex Realty Group, and andy Ato from CityPad. So just something to think about. Most of them aren't around anymore. No, I'm kidding.
That's real estate for you.
So I'm past president of Yuba and a current board member.
My company is Silver Property Group. We own and manage about 2,000 units. Okay, I'm looking for Gary Kass. That includes. That includes counting mailboxes and parking spaces. He always wants to make sure that I get the count right.
We are doing some third party management. I do want to crush Cast Management, which reminds me of a saying that him. Yeah, it's a low bar, but it reminds me of an ongoing duel between Cast Management and Kagan where they both want to take ownership of their slogan that says all management companies suck. We just suck less. So we're trying to suck a little less.
[00:03:40] Speaker D: Less.
[00:03:41] Speaker C: So that's the deal.
Do you have my slide up? All right, so here's a QR code. It goes directly to all our listings. I feel like every presentation now needs a QR code, so it also goes to my GoFundMe page.
All right, and speaking of Gary Kass, maybe two or three more references to him, but it's his birthday today and he's the only guy who looks forward to his birthday because he can move up and pick a league. He is dominating the over 80 women's league right now.
And now that he's a super senior, you know, it's less or more competition. Whatever you think.
All right, all right. Last thing here is I need to thank our sponsors.
And here's the deal. They're up on the screen. Come on, Tyler.
But you know, I didn't even know we'd have a slideshow. So I'm gonna pass around pictures of their logos just, you know, so they get proper acknowledgement. We have Integra Realty Resources.
Does anyone know what this one is?
This is Enterra. So we'll keep passing those around.
All right, Tyson, you know which one this is?
Does anyone know what this is?
You might. Yeah, we'll probably work for apartment source. You need some help on your logo?
Oh, this is gonna suck.
Anyone know this one run wise? Oh, wow, they've really been around. They're throwing money around here. You pass that around.
All right, enough of that shtick. All right. I wanted to thank everyone. Seriously. I wanted to give them a little extra time. They were very generous. We got great food and we got a great venue because of them. So please thank all our sponsors.
All right.
Every year I do like economic forecasting where you fill out a sheet and we the next year decide who wins or who is closest. And I give a magic eight ball out. Well, last year I was had the back injury, so I didn't do it. But it's been all a fake it's totally been a setup. So I decided not to do it. I'm kidding. It was legit.
So I'm just going to change up a little bit and do a group survey here. So Dow Jones is at 50,000 or so today. At the end of 24, it was 42,500. So it's up almost like 20% since then. So February 2027, a year from now, who thinks the Dow Jones is going to be higher? Just raise your hand. Someone keep track of this.
It's going to be tough to tell. All right, lower. Who thinks it's going to be lower?
All right, so so far lower. Who thinks it's going to be flat?
All right, so this group thinks the Dow Jones is going higher. Okay, gold 2600 at the end of 2024 today, over 5000, almost 100% increase.
Most of these guys who had Rolexes have traded them in one year from today. Who thinks gold's going to be higher, lower, flat.
All right, we're going to go with lower for gold. All right, last one. How many pages will be our lease this year? Now that was a joke, too.
All right, interest rates, the average 30 year mortgage for a home buyer end of 2024, around 7% today it's around 6.3% next year, is it going to be under 6% or over 6%? So under 6%?
Yeah. You guys love that. Over 6%.
All right, so we're going to go with. Interest rates are still going to go down. All right, so now I'm not, as I've said, and you guys have seen me present before. I'm not much into introductions or reading LinkedIn bio. So I'm going to introduce each guy and they're going to all kind of give us their elevator speech. That means it's short.
And also just kind of as an icebreaker, tell us what your first car was. So let's start off with Ron.
[00:07:41] Speaker D: All right, Ron Devries, I'm with Integra Realty Resources. How do we move that up? Yeah, somehow. There we go. Technology's not his thing, but I'm a radio host here.
So with Integra Realty Resources, we do valuation work, market studies, national platform offices in about 50 different cities around the country.
Busy time right now.
Everybody's still trying to get their market studies done, teeing their stuff up for the next wave of getting financing and equity done.
And first car was an Oldsmobile Spitfire.
[00:08:23] Speaker C: Nice.
[00:08:23] Speaker D: Starfire. I forget what it was now.
[00:08:26] Speaker C: Starfire. Oh, only Mike Churros can Help on this question.
[00:08:28] Speaker D: Yeah.
[00:08:29] Speaker C: What year was.
[00:08:30] Speaker D: Was the 70s? I couldn't tell you.
[00:08:33] Speaker C: All right, all right. I'm sure it was bitching. Okay.
Joe.
[00:08:37] Speaker E: Joe Root. I'm with East Superior Real Estate Partners.
We are an investment and development firm. We're an affiliate company of Root Property Group. Root Property Group was founded in 1983 by my parents. And we're today a fully integrated, vertically integrated real estate company with general contracting, property management, investment and development.
We focus on buying and managing apartment buildings in the neighborhoods in the middle market and do some new construction.
[00:09:09] Speaker C: Car.
What was your first car?
[00:09:11] Speaker E: 1984 Ford Tempo.
[00:09:14] Speaker C: Nice. I drove that car to Florida with three buddies. The guy sitting next to me was not happy.
[00:09:21] Speaker A: Hi, I'm Tyson Schutz. This thing on?
I started at the Apartment Source, the old apartment source, in 2011 as a leasing agent. So I've been leasing about 15 years.
I saved up my commissions to buy my first development in Pilsen 2014.
Have since been developing properties a couple times a year on behalf of myself and clients. I bought the apartment source in 2019, and today we're doing around 3,500 transactions a year.
My first car was a 91 Ford Explorer, Eddie Bauer Edition. It had 120,000 miles on it. And you better believe I adventured that thing like it was a Jurassic park car.
[00:10:01] Speaker C: I do not want to see the back seat of that car, Tyson.
That's kind of clean.
All right, schmazel. Hold on a second.
Can you put up his car first?
No.
There it is. Okay. All right, go ahead.
[00:10:17] Speaker F: I can't see. Move your big ass out of the way.
[00:10:20] Speaker C: I actually, for I'm a Jewish guy, it's small, you know, the front's big, the back small.
[00:10:25] Speaker F: Hey, I'm Joe Smozzle. I'm a broker at Interra Realty. I specialize in selling mid size apartment buildings on the north side of the city. I have a perspective also as an owner operator of smaller buildings with my wife Kate, also on the north side of the city
[00:10:43] Speaker D: round.
[00:10:43] Speaker F: We forgot to give Steven a shout. We're also.
[00:10:46] Speaker C: I'm gonna work up, but go ahead.
[00:10:48] Speaker F: You're introing. I thought this was like the intro, Steven.
[00:10:51] Speaker C: I'm not very good at this.
[00:10:52] Speaker F: Who shoots our podcast is here Stephen Caban from Full Bars Media.
So.
[00:10:57] Speaker C: And we'll get his information out to everyone too, if anyone's interested.
[00:11:01] Speaker F: We're live on the pod. Not live, but you know what I mean.
[00:11:04] Speaker C: So the reason Joe wanted to do this with me is he wants more viewership on his YouTube channel.
[00:11:09] Speaker F: The second I pay a bill with viewership for my YouTube channel, I'll be way more interested in that.
[00:11:14] Speaker C: But, yeah, once again, do not, do not think he's Joe Rogan. He's far from it.
All right, what was your first car for real?
[00:11:22] Speaker F: 94 Explorer.
Yeah. Nice.
[00:11:25] Speaker C: Red.
[00:11:26] Speaker F: You can't see because that's not the actual car. And you wouldn't be able to see it anyway.
There were, for some reason, driving through middle class neighborhoods in Iowa on the way to school, I decided you needed like three subwoofers in the back of that.
So that was really cool.
[00:11:42] Speaker C: Yeah, I don't think that probably helped you. Not like Tyson.
All right, so we're gonna have Ron make a short presentation. I already told him I'm gonna give him the hook if it's too long. Cause I've seen him go too long.
But when I first started in real estate, I'd go to all sorts of presentations. And I worked with the Chicago association of Realtors, and inevitably they would talk about Gail Lissner being there. Ron Devries. And I'm like, ugh, we have to listen to this guy again. Because he's everywhere. He's like dog shit. He's like cats.
And on top of it, they're only gonna talk about cranes in the city. They're gonna talk about high rises. They're gonna talk about eight blocks in the middle of the city and maybe talk about the Gold coast, maybe. None of which interests me. So I was in a panel with Ron and he interested me. So old dogs can learn new tricks. It was very interesting. And we are going to get into trickle down ripple effects. I was never a believer that anything mattered in the Gold coast to the neighborhoods or the West Loop. As a matter of fact, Jim Chan and I went to the West Loop years ago and said, this is ridiculous. Who's going to live here? So I was just there for a Bulls game the other day. I think I was wrong. So, Ron, why don't you. I'll give you this mic. You can go on over there.
[00:13:02] Speaker D: And is that going to work for you?
[00:13:05] Speaker F: Yeah.
[00:13:06] Speaker C: He's a pro.
[00:13:07] Speaker D: All right.
[00:13:08] Speaker C: This is a microphone. He's very aware of what this does.
[00:13:13] Speaker D: Yeah. Ron said, hey, do you want to be on this panel? I said, sure.
And then the next email I got was, oh, by the way, you're going to be a sponsor. Here's the invoice.
[00:13:22] Speaker F: Oh, yeah.
[00:13:23] Speaker C: Everyone up here is pay for play. There's.
[00:13:29] Speaker D: Good morning.
I just have a few slides Ron asked me to kind of tee this off a little bit, give us some things to talk about.
So why don't we go ahead and start us out. So I think you named this thing, you know, beyond the headlines, right? So what's going on behind the headlines? But let's look at the headlines first.
And you know, some of the things, if you subscribe to like, you know, Globe street and Biz now and you get all these emails and everything and it's like you see things like, oh, the rent cycles, change departments just drop, lowest level in four years, oversupply, right. And it's like, you know, what's going on? You know, it's like these headlines are from around the country, right? A lot of the sunbelt driven data that's out there for what's happening in the market, but that's not what's happening in Chicago, right. So we, you know, we survey the, the downtown market every quarter, put out a lot of stats on that. We're not really tracking in the neighborhoods right now. We track the neighborhoods, but we don't do the quarter over quarter, same store sales, so to speak, survey data.
But I think a lot of what's happening in Chicago, both downtown and the neighborhoods, is very different than what's happening around the country.
Another thing in the headlines, all the articles that are coming out now about population trends and what's happening in terms of, you know, the state of Illinois or nationally and immigration, right. And so on the left side there, it shows that the state of Illinois and this is through like last summer had an increase in population of about 16,000 people. Big deal, right? You know, that's kind of a modest number, but it's positive. Positive is good. I think what's interesting is like the red bar on the right, that's domestic out migration. So people leaving the state of Illinois and then on the left of that, that light gray high bar is people coming in, immigrating to the US and coming to Illinois.
So if it weren't for that immigration that was coming in, you know, we would have had a more, much more substantial loss in terms of population. So that immigration number is up, you know, quite a bit in 25 compared to what it was say like five years ago.
But they're, you know, they're, they're thinking that next year we could be looking at population loss in Illinois. But really what's, you know, the issue is what's going on in the city of Chicago, which is what I think most of us here are concerned about right now. And if you think about the neighborhoods and what's happening downtown, it's different. And, you know, population is increasing and the numbers look pretty good. Why do we care about that? Because as population increases, there's more household demand.
So, you know, Ron always gives me a hard time about, you know, the downtown statistics. You know, it's like. But that's not what's going on in the neighborhood. But there is what we believe is a ripple effect. It's like what happens downtown ripples through the neighborhoods. So as you look at things like, you know, rent trends downtown and supply of apartment units, that's happening as supply increases or as rents increase, that's going to make some of the neighborhoods more attractive from a price standpoint. Right. I mean, neighborhoods compete for more than just price. There's a lot of neighborhood amenities that people are looking for. But if you can't afford to live in that $5 a square foot west Loop apartment downtown, what do you look at? You know, you might look at lower quality buildings downtown or you might look at what's happening in the neighborhood and depending on your lifestyle choice. So what's happening downtown? This is our survey numbers. We're just wrapping up right now. I think it's interesting. The dotted blue line on the top is the class A rents. They're pushing almost $4 a square foot. We define class A as it's got in unit laundry, right. Washers and dryers.
So a lot of that is gonna be like 1990s or later product. Then you got the class B product is about 329A square foot. So they're both trending up. A little bit of A spread happening between the A and the B, widening of the spread in those rents. But on a year over year basis, the class A market was up almost 9% over a year ago.
Class B is up 7 and a half. So healthy rent growth. Why is that? Because there's no supply coming online. Right. So you look at this number down on the bottom here, it's like that little bump, red, red bar for 20, 25, I think we delivered 145 units downtown.
There's obviously a lot of smaller buildings that aren't in there, like the under 50 kind of count stuff.
But bottom line, last year, no supply. What's happening this year, very little supply. 27, the bar goes up quite a bit. A lot of that's adaptive reuse stuff that's happening. So interesting, interesting to see what will happen there.
So, but no supply downtown. But we're seeing a lot of buildings get constructed in the neighborhoods. Right. I'm almost done, Ron, So pay attention.
[00:18:18] Speaker C: 4 minutes and 23 seconds so far.
[00:18:21] Speaker D: All right, we're going to.
So supplies continuing in the neighborhoods. You see articles all the time, right? Everybody's building these five story buildings in the neighborhoods. Under 50 units.
We were looking at a lot of our data because we do a lot of appraisals on these for construction loans. And the downtown, the average cost per square foot, hard and soft. This doesn't include land, doesn't include profit. Hard and soft downtown average about just over 400 bucks a square foot.
The interquartile range, what's that? That's a fancy way for saying the center. 50%, right. Drop off the bottom 25%, drop off the top 25%. What's the middle? The middle center is around $400 a square foot. Then we compare that to what's happening in the low rise product. Right. So this is the stuff in the neighborhoods. So you're at like $400 plus a square foot downtown, about $250 a square footage in the. What's happening in the neighborhoods for this kind of call it the 4, 5, 6 story product.
Very different cost structure. Right.
The range is about 175 to 300. That's pretty wide.
But you know, it's a lot easier to get a loan for one of these deals that's under 50 units. The banks have a greater appetite for that. Although the banks are interested in those big downtown deals.
The equity is the hard part. But it's a lot easier to raise equity to do a 50 unit deal or a 30 unit deal than it is to do a 350 unit deal.
So that's really been driving a lot of that. And then the rents in the neighborhoods obviously are pretty healthy. So it makes sense why there's a lot of this smaller product that's coming out next week. We have a lunch event you're all invited to if you, some of you are probably coming. If you want an invite, shoot me an email. It's rdevriesr.com I can send you an invite. It's downtown at the Union League Club. Gail Listner, my partner, I think she's somewhere in the room here.
We're going to get into a lot of the details of what's going on behind the downtown market and what's happening in the suburbs. So if you're interested in that, shoot me an email.
[00:20:27] Speaker C: So you missed the one slide I really liked. Of course it's not on there. It's not in your presentation. When we did it together, there was something a month or two ago that you said there was no new construction units available. Something like that. I'm teeing you up.
[00:20:42] Speaker D: There are no buildings in lease up right now downtown.
Everything is leased. So and keep in mind, we're talking about like the 100 unit and up kind of category. So there's obviously some smaller deals that are ongoing, but all the major buildings are all leased up.
[00:20:57] Speaker C: That's interesting since you, you went over time. We're not going to give you any applause and while you walk over. I'm just going to tee this up. I'm going to move in a second. No, I'm going to move in a second. I just want to tee this up for time's sake. While I'm talking, Tyson, let's just go right into this ripple effect or what else did I call this?
Trickle down. I mean, I don't. Can you make any sense of it? And we're going to talk about that a little bit. Since I said before, I don't believe in it at all.
[00:21:23] Speaker A: Yeah, I mean, I think it's kind of organic if, you know there's no supply downtown and you have these high paying individuals who want to rent something class A, they're kind of going to the next concentric circle out to the next neighborhood, you know, and a lot of our agents are taking people who would otherwise want to live downtown to Gold Coast, Streeterville, Old Town, some of the next ring of neighborhoods to rent and then that's pricing out some of the people who would have originally wanted Old Town, Streeterville, and they're going to Lincoln Park, Bucktown and so on and so forth. So you're seeing this ripple effect of like increased demand for just about everything because there's so little supply in general.
[00:22:01] Speaker C: Joe, do you have any comment on that?
[00:22:04] Speaker E: No. I mean, I sort of think that the downtown market, I think the residents are a little different to me. I mean, I don't have data to back it up, but I just think downtown residents, especially in Those really expensive $5 plus high rises, seem to me to be imports from outside of Chicago. And the people who want to live in the neighborhoods are sort of from Chicago, from the Midwest. They moved here after college and they want to Lincoln Park, Bucktown, North Center, Edgewater.
But we're definitely seeing neighborhoods expand, which to me is very interesting when you consider the headline that Chicago population is flat or decreasing. But yet these core neighborhoods where there's a lot of demand, keep expanding. I Mean, it's not just Lincoln park and Lakeview anymore.
[00:22:48] Speaker C: So, like, when I was 57. No, when I was 50. I am 57. When. When I was 21 years old and getting one of my first places, I got a place at Armitage in Racine. I remember telling my dad's friends that I was buying a place, you know, 30 years ago or so at Armitage in Racine, and they're like, are you kidding me? Like, you're gonna get killed there. So I think there's so many neighborhoods now that are viable for people. I don't know. What do you think about that, JOE
[00:23:15] Speaker F: S.
Yeah, I think there's been. I think there's more parity across north and northwest side neighborhoods than there were in years past.
I also think about this, like, ripple or trickle down in the context of, like, investor sentiment. So in the last few years, we've had pretty healthy market in the neighborhoods from an investment sales standpoint. But it's been a lot of local folks, a lot of people who were seeing top line revenue growth, who are coming to these events, knew there was limited supply coming online, were able to make a thesis around rent growth over the last few years.
But when you see these downtown deals start to get done at a lot healthier metrics, it puts Chicago on the map more as an investable market from folks who are outside of the city or who are otherwise on the sidelines for the last couple years. So I think just seeing a vibrant investment sales market for these splashier downtown deals and you're reading about them in cranes and not seeing depressed pricing is powerful for sentiment of investment in the deal.
[00:24:15] Speaker C: Let's make it objective. I mean, are you seeing guys from New York saying, I just got an email the other day, a 3 flat, you know, in a good neighborhood was like $5.5 million. It was a store and then two units.
Buddy sent it to me and said, you want to buy this for your daughter? I responded, no.
So I don't know. Who are the buyers? Are they from all across the country? Is there one place they're coming from? Are they getting aced out by Chicago guys? I mean, what, what's your objective?
[00:24:43] Speaker F: I mean, I don't. I don't think a three flats.
[00:24:47] Speaker C: I'm not saying three, you know, but.
[00:24:48] Speaker F: But I'd say the folks who are winning the deals are still mostly local.
[00:24:54] Speaker D: The.
[00:24:55] Speaker F: If you look at the whole set of activity that we have on the deal, there's a lot more diversity in terms of where folks are from. What the profile is than there was a couple of years ago. So I expect that to translate into them competing a little bit more aggressively right now. It's more in the looking phase than the kind of converting to being the buyer phase. There are certainly examples of out of state folks winning deals, but if we're talking broad strokes, I'd say still mostly local owner operators, people who are again, just seeing their operations.
[00:25:28] Speaker C: And all those guys who, you know, said, I'm never buying in Chicago again, I'm buying Denver, Salt Lake, Asheville, Nashville, Miami.
Are they back?
[00:25:38] Speaker F: Yeah, I mean, yeah, with a straight face. And like, I think we have to kind of, you know, pound our chest a little bit. Because if we were sitting here four years ago, so many folks were going to Nashville or Phoenix or Denver, one of these, Florida, one of these splashier markets. I mean, we're losing a lot and not just in the institutional stuff, middle market product too. And, you know, now rents are receding pretty dramatically in those markets and we're seeing rents go significantly the other way here.
So I think we have to take the opportunity, when we have it, to compare Chicago and the stability we've had and the rent growth that we have versus some of those markets that were sexier a few years ago.
[00:26:17] Speaker C: So Tyson, I had a renter that was in our apartment for years. He's like, I'm moving to Denver, I gotta move to Denver.
Then went, moved to Denver, didn't get a real good job, ended up being a wait person telling me that cost him like $30 a day or $40 a day or whatever to go park at his job. And he couldn't make it. He missed his family and friends. Is his apartment still available in Albany Park? Do you have any stories like that? I mean, are you seeing people coming back or leaving? What, what do you see?
[00:26:47] Speaker A: I mean, just anecdotally, my friends from college who kind of went to these other markets.
[00:26:51] Speaker C: You had friends in college?
[00:26:53] Speaker A: Believe it or not, I had two or three of them.
[00:26:55] Speaker C: Okay.
[00:26:56] Speaker A: But there are a lot of them are moving back and it's the same, same sort of story. I mean, there's, you know, there's overall, I think, a problem with affordability in general in our country. But when you look at what Chicago has to offer for like the average renter and just being such an amenity, rich city and with our diverse economy and just various job industries, it's an attractive proposition, especially if you have family or two or three friends here.
[00:27:24] Speaker C: So I did some math and anyone who wants to jump in Jump in. But I did the math and at minimum wage in the city of Chicago, you're making about $36,000 a year. So a third of that. Right. Is the metric we use. That's 12,000, that's 1,000amonth that you can afford in theory in rent. I know that's not always practical, but let's say someone making minimum wage could pay 1,000amonth in rent. You have a roommate, you can go get a two bedroom for $2,000.
I mean, I don't see that that's a problem in the city of Chicago to find a viable neighborhood to get a two bedroom apartment for $2,000. Am I missing something here or is that the wrong way to look at affordability? I mean, we're getting hammered as owners saying, you know, rents are too high and there's nothing affordable. Am I way off base?
[00:28:10] Speaker E: I don't, I don't think so. I mean, I think about it the same way and I think at our property management business, we think about it the same way. We look at rent to income ratios and they seem pretty solid. And I totally agree. When you look at what minimum wage or somebody who's making entry level pay at a professional services firm makes, it seems like they can afford most of the units, even the new construction units that are going up. So I think Chicago still remains a very affordable market.
[00:28:34] Speaker C: I mean, once again, I'm using the word objective a lot. Tyson, what do you, what are you saying for, I don't know, young professionals or older professionals or age? I mean, I'm going to give you the stage and what's, what's a typical renter in this Edgewater uptown neighborhood? And how much are they making? And you know, is, is the age really? I'm throwing a lot of stuff out here, so maybe I'll just be quiet in a minute. You guys can rift on this, but you know, the other stat is the first time buyer nationally is now 40 years old, which is stunning to me, which is good for me and our ownership and good for my kids someday probably.
Although they never give me a lot of appreciation. But that's another topic.
[00:29:19] Speaker A: I'm not sure what the question was. Except talk about, talk about Edgewater and Uptown. Right? Well, which I got, I got you.
[00:29:25] Speaker C: I don't know.
[00:29:26] Speaker A: Edgewater Uptown is, I don't know, someone translate for me.
[00:29:28] Speaker C: I forgot too. I'm getting as old as Gary now,
[00:29:31] Speaker A: so it's all good. I think Edgewater and Uptown is really unique in that there's a lot of just High density, like courtyard type properties. And there's a lot of studios, one beds.
[00:29:41] Speaker C: I think I asked what a real typical renter.
[00:29:44] Speaker A: Renter, right.
[00:29:45] Speaker C: That was about three years ago when I said that.
[00:29:47] Speaker A: Yeah. So it's a mix of everybody, but there's a lot of just like single tenants in Studios and One Beds. So there's, you know, 60 to $100,000 in income and there's a lot of just adaptive reuse and renovations. And I think, you know, these buildings lease up fast because you're close to the lake, you've got transit, you can get downtown pretty quickly. And, you know, there's great bars and restaurants like most of our, like many of our neighborhoods.
[00:30:13] Speaker D: I'm curious, with the tenants that are coming into Edgewater and uptown, where are most of them, like, moving, like within the neighborhood or where do you see. Are you seeing a trend where people are coming from another neighborhood?
[00:30:24] Speaker A: Yeah, that's a good question. I think it's a mix of both, really. We get a lot of out of towners who just can't quite afford, you know, maybe their first choice was Wrigleyville or Buena park. And then we're kind of just going up Lakeshore Drive a little bit to get them into the next closest neighborhood to the amenities they want to be near.
But yeah, I'd say it's probably half and half out of towners and then in towners who are moving in alone or, or splitting up or whatever. But when I think of Edgewater and uptown, I think a lot of just like single tenants because these courtyard buildings are so full of one beds and
[00:30:55] Speaker F: studios, so, so funny, like, you know, the conversation around affordability. I think context matters. So, like, I think when we do that math today and you think about it today, we can make sense of it. I think that the public perception and the narrative misses the part where that tenant, in your example, that's paying $1,000 for either a studio or, you know, roommate situation, maybe they were paying $800 a couple of years ago for the same situation. So I don't think they're saying, okay, my math today. I'm sure they're still doing the math for today. But the point is, just like in their head, the rent went up 25% in a few years. And I think what we've missed as an industry, and I think it's improved is the why and is being communicative with people as to.
Look, I'm sorry that your rent went up. Here is a copy of our assessment from last year. You know your rent went up 4, 5, 6%.
Our property taxes are going up 20%. Here's the water bill, here's the insurance. Like, I think transparency and humility in that conversation goes a long way. Because then it's not like, you know, we're the fat cat owners and this is all going in our pocket. Then it's like, look, we're trying to keep up. We're still trying to do a good job in keeping within this band that we consider fair. And you're smirking.
[00:32:21] Speaker C: Yeah, it's working. I want you to make a video.
I want you to make a video and I'm gonna send it to all my tenants and they're gonna call BS on you. I, I, look, you, you know, you guys can jump in too, or anyone out there, but I've written that letter. I've written the letter. My taxes are this, they were this. I've written that letter. My, my staff cost this, and now it costs this. There is no interest in that by the tenant, in my opinion.
[00:32:45] Speaker F: Well, maybe it's. You might hear back from the, you know, like, our scale's much different.
So in the context of a 50ish unit portfolio that my wife and I operate, we really don't hear, I mean, we have heard very few people, like, get defensive to that and get argumentative to that. Overall, it's appreciative. In the context of your portfolio, a few thousand units, you're just going to hear from like the loud minority of people. And I'm not, I'm not numb. I'm not saying you should be numb to that.
[00:33:12] Speaker C: I'm sorry about that.
We all in the room have to remember that it's like less than 1% of the people that we deal with are bad apples. Right? I mean, it might be less than 0.1%. And I always tell my staff in my office, you know, just remember it's just a few bad apples. Don't let it tint your whole view of all our tenancy. But I really don't believe that, you know, for the most part, that they want to hear that. As a matter of fact, I stopped writing letters like that because they just were repetitive and they were like year after year.
So I don't know. I disagree a little bit. I don't know. What do you think, Joe Root?
[00:33:48] Speaker E: Well, first I wanted to add something in the Edgewater Uptown area, please. We bought a building for the first time in this area in 2024. And it was a building that had been gut renovated and for us it was kind of interesting. As we were looking at our rental comps, we saw a lot of new construction in the area. This is the east, east part of Uptown Edgewater.
And then we didn't. And then we saw a lot of buildings that didn't appear to have been updated in a long time. And so it seemed hard to find good comps for an updated unit in a vintage building with in unit laundry, forced air and H Vac.
So that was a little challenging, especially to convince ourselves that we could continue to get those rents in a larger building. But it turned out to be there was a lot of demand for that because we were priced below any of the new construction units and we offered a unit that was in much better condition than a lot of the comps in the immediate area. So we've, we've really enjoyed that property.
[00:34:48] Speaker F: So, Ron, really well brokered too.
[00:34:51] Speaker E: It was really well.
[00:34:52] Speaker C: Exceptionally well brokered. It was exceptionally well brokered. My mouth is filling up with, like, vomit. Okay, Ron, just to bring this full circle, what, what is. I don't know, you want to talk about Gold coast department or on a west loop, but it was a one studio, one bedroom, two bedroom for all of us here who, you know, don't go south of Wrigley Field.
[00:35:16] Speaker D: I think when you're looking at the newer product, keep.
[00:35:18] Speaker C: Put the mic up.
[00:35:19] Speaker D: I keep having a problem with this.
[00:35:21] Speaker C: I know. And it's really surprising the amount of talking you do.
[00:35:24] Speaker D: All right, so I think, you know, the benchmark was, you know, a few years ago when all of a sudden in the newer buildings, when the one bedroom rents broke through that $3,000 a month category. So hit, hit past that line and, you know, studios are going to be, you know, in that 22, $2,300 range.
And then, but like I said, when that, when that one bedroom crossed over 3,000amonth, I think that was, that was a, everybody kind of took note of that.
[00:35:55] Speaker C: So Tyson, how, how do you tell. I had a whole thing on, as you can imagine, on this question. But how can you tell that your rents are high enough? It's, it's kind of a crazy question, but every time I raise the rents, we fill up, and then we raise them again. We fill up. My investors tell me, why aren't your rents higher?
My leasing office says you're pushing the rents too much. You're making it way too hard for us. And then we get it. Like, I mean, what's the limit here? Like, how do you. I mean, I know that's your Special sauce. But how do you, how do you figure out where the rents are these days?
[00:36:30] Speaker A: Yeah, so it's, it's all data for us, right? We're looking at comps and we're looking at days on market for the comps and just if they were reasonably priced to begin with. You kind of have to be careful, careful. You know, if you're using AI to price your units, it's really not accurate because it's not taking into consideration things like short term leases which might have elevated rents.
You really kind of need, you know, good data to, to figure that out. And you know, clients may always complain that the rents aren't quite high enough, but if you can demonstrate that you're at market or higher even in some cases, then you're in good shape, right?
[00:37:07] Speaker C: Well, I don't know. I mean you talk about AI and all these other assisted things and I know there's a lot of people in the room that don't use it, myself included. And we just kind of figure it out and seems to work, but maybe it's not, I don't know. But you mentioned before AI, you know, I've heard of ChatGPT, SEO. I got corrected that it's not SEO, it's GEO. And I got corrected again by someone else here, Greg Bukarski, aieo, I think, I mean what are these things? And you know, are you old school operators? Are we really, you know, messing up?
[00:37:42] Speaker A: So I mean, all you're really referring to is how search results appear.
[00:37:46] Speaker C: I'm just trying to drop, you know.
[00:37:48] Speaker A: Yeah, this one caught me off guard. I'm glad I actually know the answer to this because we had no prep for this whatsoever by the way, but
[00:37:55] Speaker C: geo's hours, by the way, working on this. We three day boot camp to work on this. I could tell that it's really working.
[00:38:02] Speaker A: I happen to be talking to ChatGPT about this very topic and GEO is generative Engine optimization. And it's just a way for like AI to find your website as a, as a high level result. So if you're listing a lot of apartments, you're optimizing your website to appear as a top result through AI. And I don't know, we might have to ask Greg, but I think AIGO is similar or the same thing.
It's optimizing your website to be a top result.
[00:38:33] Speaker C: So are we missing out, all of us that don't do any of this or are we getting it through osmosis or through other things or through our app Folio?
[00:38:41] Speaker A: It kind of depends on where you're marketing. Obviously the big third party websites are optimizing for geo and AI. Zillow, apartments.com or probably investing very heavily in this. It's, it's just how SEO has evolved. We're no longer just putting keywords on our blogs. Right. We're, we're trying to implant information on our websites that come up as results through your AI searches.
[00:39:03] Speaker E: All right, so is it, is the reason this is happening is because people instead of going to Google and typing apartment in uptown are going to chat GPT and saying where can I find
[00:39:12] Speaker D: an apartment up there?
[00:39:13] Speaker A: Yeah, well they might say like I, you know, they might be very specific in what they want. So like it's a lot more extensive language that's producing the results.
They're prompting AI to find a two bedroom in Bucktown at a certain price range. It might not be the quick Google keyword search anymore as much as very specific things that have to do with the property. Is it exposed brick, is it timber, loft, et cetera.
[00:39:38] Speaker D: How much do you find people are using even like YouTube for creating videos of their property and we talked earlier about like Tic Tac as far as, you know, people finding apartments using TikTok, not Google searching.
[00:39:51] Speaker A: Yeah, I think social media, if it's not part of your game, it's no longer like the cherry on top. It's really just essential if you want to generate as much demand as possible. The eyeballs that are on TikTok and YouTube and Instagram aren't necessarily the same eyeballs on Zillow and apartments.com so you need to have a strong social media presence if you're really trying to max rent and max velocity certainly for like a lease up.
YouTube is my favorite social media platform. I like that medium format and I think it's increasing in terms of people wanting to go there because my personal opinion is the algorithm is not quite as, I don't know how to say this, like just it's not quite as nefarious. It's a little bit more, I don't know, it's organic. It feels like legitimately what I want to watch and it's not pushing a bunch of stuff in front of me.
And I think YouTube's a great platform for brokers to get onto and just provide more value about neighborhoods. You know, a couple of the brokers in the city are doing a great job with food reviews and stuff like that.
[00:40:52] Speaker C: So speaking of that, I had a couple canned questions just for fun here and I put in chatgpt for all four of you.
What would be the job if you weren't doing real estate? What would you want to do now? I put it in for Schmazel, and it came back, too. It came. Came back bodybuilder or WWE wrestler. So I don't know, Joe. What guys? What? You know, we sit on panels and we talk a lot. And we talk.
[00:41:20] Speaker F: Keep scrolling, Tyler.
[00:41:22] Speaker C: No, no, no, no, no. I mean, that's. That's. That's a month ago when he was cutting weight, when he was shredding.
He's got a pay deal with creatine for a show.
But. So what would you. We do these, and we talk to younger people, and we talk about barriers to entry and all that sort of thing, but what do you think you would be doing if you weren't doing this?
I gave you the question before.
[00:41:49] Speaker F: You got me.
I got. No, I'm a little rattled right now.
[00:41:54] Speaker C: All right, we'll come back to you, Tyson.
I don't have a slide for you.
[00:41:59] Speaker A: Nothing good, that's for sure. I'm a musician. I'd probably be touring in a van right now, sleeping in the back.
[00:42:03] Speaker C: What do you play? What was your deal?
[00:42:05] Speaker A: Guitar is my main instrument. I've been playing since I was 12.
[00:42:07] Speaker C: Really?
[00:42:08] Speaker A: Do you sing very poorly? Yes.
[00:42:10] Speaker C: Okay. All right, good. We'll give them more reverb. Give them more reverb. It'll sound better, Joe.
[00:42:17] Speaker E: Well, I feel blessed to be in this industry. I started my career in corporate finance on Wall street, and. And I'm very happy to not be there anymore. So I'd probably be working at some big company, sitting behind a desk, creating spreadsheets or PowerPoints.
[00:42:31] Speaker C: Ron, what beach would you be on right now?
[00:42:33] Speaker D: No, yeah, I forgot about this question.
[00:42:36] Speaker C: What would you do if you weren't in the real estate or doing what you do now? Because I know you love.
[00:42:41] Speaker D: I've been doing this 40 years. Hard to believe. And it would be something else in real estate. So maybe not, obviously, in the valuation and counseling side now, but I don't know. Maybe I'd try and be like Joe.
Everybody wants to be like Joe.
[00:42:58] Speaker C: Well, if you want to be like Joe, he can tell you what testosterone and creatine he's taking.
I'd be probably a lawyer. I didn't know any better. I went to University of Illinois because I had a buddy who was in a fraternity there. I went to DePaul Law School because my dad was a lawyer. I worked with my dad because he was a lawyer. I started doing Some other stuff. And me and Jim Jan thought of a crazy idea to buy plans and permit on Southport. And next thing I know we were doing that and loved it a lot more and started making the same and then more money and it was a lot better. So I'm pretty blessed that I'm not a lawyer. No offense to those of you that are lawyers in the room. I'm sure some of you might have made the right choice, most not.
All right, let's go back to this, Joe, how we're going to wrap this up in a few minutes and take some questions. But I often say if you gave me the land for free, I don't know how I could build with these costs.
Managing is very difficult with rising costs. What can you do to manage costs and can you build ground up right now?
[00:44:04] Speaker E: We're going to start a ground up project this year. So yes.
[00:44:07] Speaker C: Are you doing it for free or as a passion project?
[00:44:11] Speaker E: Not a passion project, no. We hope to make money.
[00:44:13] Speaker A: Okay, yeah.
[00:44:15] Speaker C: How are you going to do that?
[00:44:16] Speaker E: Well, I mean we bought some land and took a risk and closed on the land before getting any entitlement done.
And then we were able to get the zoning changed. So we increased the value of the land quite a bit. So our basis per unit is pretty good.
So that helps.
And we have a partner who's building these types of apartment buildings and I'd say that their costs to build it are going to make it work.
And we're in a neighborhood where we think we're going to get around 350 a foot in rent and hopefully that makes it work.
[00:44:50] Speaker C: How about on the management side? Is there anything on the operations side and any of you can answer this that you've seen in viewing buildings or helping owners to cut costs?
[00:45:00] Speaker E: Well, I'll say first of all, one help on this project has been Tyson and Apartment Source because they're, they've been working.
[00:45:06] Speaker C: Wow. I didn't even know there was a direction.
[00:45:07] Speaker A: So yeah, you guys can't see this, but I'm handing them $100 bill.
[00:45:11] Speaker C: I see where your hand is and it's not giving them $100 bill. But that's.
Wait, did I say that out loud, sir?
So anything else you guys that operational you've seen maybe touring buildings, helping owners or anecdotally to cut costs?
[00:45:29] Speaker A: Something interesting, I think just outsourcing some of the administrative tasks to good virtual assistants and AI for I think AI is getting really good at routine processes, especially data transfer.
So if you know there are consultants out there if you don't want to deal with it yourself. And it's pretty affordable, actually, to get a strong opinion on how to improve your workflows. For so much of what we do in operations is just routine, you know, just routine administrative tasks.
[00:45:59] Speaker F: I think two things that come to mind on, like, driving NOI part of it and cutting costs. I mean, one lever that people have started to pull more frequently is the AHSAP program for real estate taxes. So especially in the context of a new construction.
[00:46:15] Speaker C: Sarnoff, one of our sponsors today.
[00:46:17] Speaker F: Yeah, Sam Goldberg, I don't know if he's here, but he's kind of like
[00:46:21] Speaker C: made himself 5,000 next year for that one.
[00:46:25] Speaker F: But if you're already giving 20% because you need a zoning change, like, there's not a whole lot of a give on the revenue side. And there's pretty significant savings on. On taxes. Also, if you're renovating a building, especially if you have smaller format units, there's not as much of a spread in the affordable rate on the smaller format units. If you have some studios and ones, the math can be favorable.
The bigger thing on NOI has just been making sure, like, revenue is in line, you know, and if you were a little complacent with a rent roll for the last three years, when we've had 7% or so rent growth in the neighborhoods, you know, be 20% below market.
So we see that pretty frequently where situationally somebody was a little complacent and rents have, you know, I know everybody in the room's price of brokers saying that, you know, there's upside in the rents on every deal we send. But there's.
[00:47:20] Speaker C: That's what's never seen a building listed on the MLS that says rents weren't below market.
All right, I'm going to wrap it up before we get questions. I mean, I had a whole list of things we. We prepped for like 10 minutes, and I was like, stop. Like, we don't need to prep. These guys know everything. And we could go on forever and ever.
But so the question is, and we'll just go down the line, you know, how does this party end? You know, I don't know. There's a lot of cliches. These guys made fun of me. I didn't have the right one for any of them. Or, you know, who gets off the ride or when does the merry go round stop? I don't know. There's some cliche here. Things are pretty good. I know a lot of us don't want to Admit that sometimes. And you know, we have our challenges and I don't think there's any press here. So we can say these are probably pretty good times. I mean, we have rent increases, taxes, they're starting to get a little more predictable or we're starting to know what they think they're going to be over the last couple years, you know. So how does this ride out? I mean, like, we've seen it go very badly in 2008, right?
Who would have thought? So how does, how does this end? Or does it never end as wishful thinking? All right, enough.
[00:48:31] Speaker D: I don't think that, I don't think the merry go round is going to slow down anytime soon. And I think that the reason is because, you know, we talked a little bit about population maybe, you know, having some challenges there, but there's just, there's not any material change in supply.
So what, what is going to hurt the rental market, you know, if we have like this massive influx of apartment buildings being constructed downtown? That's always a challenge for the short term. Right.
But I don't, I don't see that happening, anything changing on that front anytime soon.
So I think that, you know, if you look at the rent growth that's been happening, that's going to continue, job market is a little quirky right now.
That could, that could slow us down a little bit. But you know, there's not going to be this big supply chain coming that is going to materially impact the rents.
[00:49:25] Speaker C: Joe Root?
[00:49:28] Speaker E: I mean, I think there's a couple things that I, I, I'm somewhat concerned about. I don't think the merry go round is coming to an end.
[00:49:35] Speaker C: You like that anal analogy?
[00:49:36] Speaker D: Yeah. Okay.
[00:49:37] Speaker C: Anal analogy, Analogy, analogy. Okay.
[00:49:39] Speaker E: One thing we looked at, we looked around the country at other markets a few years ago and we noticed that how much supply there was coming online in places like Austin, Texas and Nashville, Tennessee, where 20% of their units were under construction and their vacancy rates were over 10%.
And then we looked at Chicago where 2% of our units were under construction and vacancy was within 5%. So we ended up coming back and never doing anything outside of Chicago because of those fundamentals.
But the thing that I guess concerns me a little bit about what could happen is our rent growth was terrific last year. Double digit rent growth in both our vintage and our new construction portfolio.
But our NOI as a percentage of that gross rent decreased a couple hundred basis points.
And so what concerns me is that as there is less supply here and as we start to get Near a point where residents don't want to pay the increases. If we can't get those big rent increases and expenses keep going up, I think there could be some kind of correction.
[00:50:42] Speaker C: So you're saying if rents stay the same or go down and expenses go up, that's bad.
[00:50:49] Speaker E: I would just be okay.
[00:50:50] Speaker C: Just trying to make it easy. Charles was giving me a look like he didn't understand, so I just wanted to make a little easier for him. All right, Tyson.
[00:50:58] Speaker A: Yeah, I think things are good right now. It's, it's a byproduct of limited supply in terms of our rent growing. I did see a stat somewhere, and don't quote me on this, I don't remember the exact number, but there's like 120 or 140,000 permits issued right now for new construction. And I don't know if that's, you know, in the city like Chicago. I don't know how much of that is going to come to fruition or when.
But I can say just personally, we've been proposing, we've been doing a lot of rent analysis for a lot of loop, a lot of downtown adaptive reuse and new construction back downtown again. So I do think that pendulum will swing where we do have more supply and hopefully rents don't stabilize too much because Chicago will keep increasing in value.
We've got a lot of like, you know, headline worthy growth in this city with Google coming and so on and so forth.
So hopefully we can absorb that new supply whenever it does come around.
But yeah, you know, I share the same concern with Joe. If expenses continue to rise and we do get hit with a lot of that new supply at once, like say 2028, we might be in a situation where we are two or three years behind the coast, which they say all the time.
[00:52:11] Speaker C: And Joe, are you schmalz? Are you just worried that you'll have too many buildings to sell and you'll be too successful?
[00:52:18] Speaker F: I, I, I think it doesn't feel like a part. Like, I agree that it, it's pretty good. It doesn't feel like a party. It doesn't feel like it's easy. It doesn't feel like we have this massive tailwind. So I don't know that the analogy is like when does the party end? I just, I think that it's getting, I agree.
[00:52:46] Speaker C: It feels like a party.
[00:52:47] Speaker F: I guess if you're asking me like what I, you know, what would keep me up at night or what, like the regulatory stuff in a, you know, that's, you Know, we're just. The lease. How much longer can the lease get? How much more complicated can it get to run these buildings? How, you know, how much more opposition can you get?
[00:53:05] Speaker C: That's a competitive advantage for all of us here. I mean, like, I don't know what I'm doing in New York, and I don't think a New Yorker comes here, knows, doesn't have a clue how to deal.
[00:53:13] Speaker F: Well, I think that's where, I mean, like, I think the people in this room could say, yes, it feels pretty good. We're all here. We're all trying to be, you know, among the best at what we do and learn from each other and stuff. And, like, not every. It's not that way for everybody. I think a lot of people, if you were to look at the whole set of owners or service providers, like, a lot of people would say it's a pretty tough time right now.
[00:53:33] Speaker C: All right, well, thank you, guys. So my plan was to do this till 9. It's 9:04.
If you want to stick around and ask some questions, I would say we do this for another 10 minutes max, if there's some questions, and then, you know, everyone can have another egg sandwich.
Is there any other. Is there any questions or does everyone want to leave? I'm open to questions. Usually Mike's good for one.
Yeah, of course.
Concern with rent control that is starting
[00:54:08] Speaker E: to rear its ugly head again this session down in Springfield to allow local municipalities to impose that.
Is that a real danger in your estimation? And if it happens, what are the results on real estate values and apartments?
[00:54:27] Speaker F: I've been at it for 15 years, and it's kind of been on the radar for 15 years. I think that when you're in an environment like we're in, where we're pretty far left, it becomes probably more of a concern or closer on the radar. Right.
I don't know what we can do other than keep pointing to all the examples of it not working.
And not only not working, it having the opposite effect. Everywhere that it's ever been employed has seen the affordability crisis deepen.
So concern. Yeah. Like, I think that it impacts some product more than others. You know, if you're.
[00:55:07] Speaker D: If.
[00:55:08] Speaker F: Ronnie?
[00:55:09] Speaker C: No, I was going to have an interesting view. It seems like, you know, once again, like I said, people in this room know how to adapt, know how to handle Chicago. I don't want rent control. We don't want rent control. But we'd figure it out. And I think the people that own stuff, I think they'd Benefit, we'd have tailwinds. We know how long till it started, we know what to do.
You know, I think it would make it harder for people to entry, enter this and once again make non rent controlled buildings more valuable. So, you know, everything the city does seems to kind of backfire a little bit and actually make our buildings more valuable. So I'm not condoning rent control, but that's, that's, that's kind of my feeling.
I also kind of get blown up on my, my taxes view in that maybe some of us don't admit it, but some of us paid really low property taxes for a really long time. Maybe we're giving some of it back. So I don't know. I think the people who own buildings here are in a very good position. Any other questions?
All right, I'm going to do this.
[00:56:09] Speaker F: I have a quick question, Ron, for these guys.
[00:56:10] Speaker C: So like how are there bodies of temple and how do I.
[00:56:14] Speaker F: Okay, are there any pockets of like that are either exceptionally strong from a rental standpoint, like you know, unit types or like characteristics of units that are like exceptionally strong or like softer?
[00:56:28] Speaker A: Well, first thing that comes to mind is neighborhood when you ask that question. I think, you know, overall the city's projecting another 3 or 4% growth citywide. But if you're in Lincoln Park, Lakeview, some of these very high demand neighborhoods that have just no supply right now you might be achieving 10% increases. And you know, the first thing that came to mind were some of these other peripheral neighborhoods that I think are undervalued but are starting to gain a little attention. Belmont Gardens is awesome around Kilbourne park, that area of like Irving park, these are great neighborhoods and I think we're seeing a lot.
[00:57:02] Speaker C: Are any people asking for those neighborhoods or are you pointing them in that direction?
[00:57:07] Speaker A: Yeah, so this goes back to that ripple effect, right.
People who haven't been in the rental, rental market for five or six years because they had a great lease, who were living in Bucktown, for example, or Roscoe Village are, are priced out. Now they're going, you know, a neighborhood out outward. Avondale's obviously been very popular for some time and Belmont Gardens is right there.
Irving park are on the blue line. So it's just, it's just an organic, you know, byproduct of this lack of inventory. So yeah, we have people who, a good agent will direct them to the next neighborhood over if they're not familiar with it. They may not necessarily be requesting Belmont Gardens, but we're taking a lot of Avondale clients there and they're. They're closing on.
[00:57:46] Speaker C: All right, two minute warning. Anyone else have a question? I'm going to do something. Guess my better judgment. I am going to give the microphone to Mike Glasser for. Yeah, I know that you're late. Thank you. That would have been great. I'm going to give you the microphone to announce the pack event, but you literally, I'm going to come and beat the crap out of you if you talk more than a minute. Okay? Okay.
I don't know.
[00:58:12] Speaker D: All right, ready?
Aaron Borenstein, stand up.
Aaron is the chair of the NBOA pack.
In this location, courtesy of Joe Hayes, we are hosting a PAC fundraiser with
[00:58:28] Speaker A: an incredibly relevant and interesting keynote speaker. Who is that?
[00:58:33] Speaker D: Aaron Rahm Emanuel will be our keynote speaker. The fundraiser is for the NVOA pac. If I had more time, I'd have Mike Meaney come up here from the
[00:58:46] Speaker A: CAA to introduce you to the reality that we really do have some regulatory
[00:58:52] Speaker D: hurdles ahead this year. There's things that are going to be
[00:58:56] Speaker A: very disturbing as it pertains to possibly
[00:58:58] Speaker D: just cause eviction, which we call endless
[00:59:01] Speaker A: lease, possibly a rental registry which could cost us each $100 per unit per year. There's really issues that we as an
[00:59:10] Speaker D: industry have to oppose.
Having a well funded PAC is a tremendous opportunity.
[00:59:16] Speaker A: So I urge you all to look
[00:59:18] Speaker D: out for the invitation that Aaron's sending out the next day.
How's that?
[00:59:22] Speaker A: Nailed it.
[00:59:25] Speaker C: All right, we're going to wrap it up right now. I want to thank the panel.
I think our takeaways is, you know, as much as I didn't think this was a thing, the ripple effect argument, I mean, it's truly something that's happening.
We have a lot of good neighborhoods. We have a lot of good product.
We didn't really touch on it, but I think we have a lot of owners that care and that are really trying to do the right thing, even if the media or the NIMBYS or the government say otherwise.
I don't know any other takeaways here that we have a supply problem, which once again, very good for those of us that have stuff.
And I look forward to seeing everyone next year and see if this group understood what was going on. How about this question is, is, are your rents going up by more than 5% this year? Who's got rent increases more than 5%?
All right, who's got rent increases that look closer to 10%?
All right, who's got rent increases that look more like 3%?
Who's decreasing rents, I'd be open to buying your building. Please.
Once again, thanks, everyone. Happy birthday, Gary Kass. See you next year.
[01:00:46] Speaker A: Thank you.
