By Mary Ellen Podmolik, Chicago Tribune
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Suburbs that have long thought of themselves as bucolic communities filled with houses and families are warmly embracing the very type of residence that used to make them leery: the apartment.
Just don’t call them rentals, a word that conjures up an image different from the projects that municipal governments are selling to their constituents. Almost 4,000 apartments in well-appointed, amenity-filled buildings with rents to match are under construction or proposed in suburbs throughout the Chicago area. They are designed to attract young professionals and empty nesters with roots in the suburbs.
Some, but certainly not all the projects are transit-oriented, constructed near suburban downtowns and train stations or they are being used to create a downtown where there never was one before. But as they move forward, communities are grappling with concerns about density and traffic congestion, and affordable housing advocates worry that low and moderate-income residents who rely more heavily on public transportation don’t have the option of living near it.
In the past, many suburbs were loath to consider large-scale apartment projects, worried that the buildings would change the community’s demographics. They did, however, like condominium developments, but those dried up after the housing crash and remain difficult to finance. Instead, developers and suburban governments have turned their attention to large apartment buildings.
“Renter-occupied housing can represent some challenges and it can also bring in a more moderate-income household,” said John Melaniphy III, director of economic development in Wheeling.
However, the development of two apartment complexes with almost 600 units combined, along with a retail and restaurant component, is underway in Wheeling, which, like other communities, established a tax increment financing district to attract developers. Rents for one-bedroom units start at around $1,300 a month. Still, that’s at least $500 a month less than rents for the smallest units in luxury buildings in downtown Chicago.
The high rents “certainly were a factor in our decision-making process,” Melaniphy said. “We’re bringing a higher quality resident with a higher household income. If the condo market were stronger, we would certainly encourage condominium development.”
Common-space extras like dog-washing stations, prep kitchens, theater rooms and business centers are a draw.
Ninety7Fifty on the Park, a 295-unit development in Orland Park that opened in the spring of 2013, is 94 percent leased, said Brian Moore, a spokesman for its developer, Indianapolis-based Flaherty & Collins Properties. In Wheaton, Morningside Equities Group’s 306-unit Wheaton 121, which was completed in February, is 75 percent leased.
David Strosberg, Morningside’s president, also says municipalities have had an attitude adjustment.
“Many of them equated rental housing with low-income property,” Strosberg said. “It’s more recent that they’ve appreciated that rental comes in all different forms. There’s market-rate housing that appeals to a significant portion of their residents who don’t want to make a commitment to buying a place today.”
It is those changing attitudes of both municipalities and consumers that has companies vying for projects in multiple communities. In downtown Elmhurst, for example, Morningside in 2008 planned a condominium project on city-owned land but it was mothballed with the housing recession. Six years later, the company is working with the city to develop a 192-unit apartment building that Strosberg describes as “ultraluxury.”
“Developers are looking at it as ‘I have this land, how much density can I put there,'” said Valerie Kretchmer, a real estate and urban planning consultant who has worked with several municipalities. “These projects can work in areas where you can get reasonably high rents.”
Orland Park is frequently mentioned by officials from other suburbs as one to emulate. The closest thing the village, 37 miles southwest of Chicago, had to a downtown was Orland Square Mall. So two decades ago the village started envisioning the creation of one.
It began assembling property and created a TIF district near a Metra station near 143rd Street and La Grange Road. It selected a condominium developer for one parcel, but then the housing market collapsed. The village has shifted gears to apartments and hired consultants to complete market studies to determine whether the community could support the large projects that most developers say they need to build to make the numbers work.
Today, residents at Ninety7Fifty only have to walk across the street to hop on the train. Another company, REVA Development Partners, broke ground this fall on a 231-unit luxury development. The University of Chicago will break ground next year on a 120,000-square-foot medical office building nearby and a Mariano’s Fresh Market is under construction next to REVA’s site.
“Everything is panning out better than we ever hoped,” said Karie Friling , Orland Park’s director of development services. “Most of our suburbs, when they think about rental, think it’s just a building with a bunch of units. We wanted it to be a way of life. We knew we had to have the amenities. People would pay and want to live there. It’s resort-style luxury living.”
The changes are a shock to apartment shoppers who may have one lived in a third-story walk-up with a laundry machine in a dingy basement. The last time Chris White looked for an apartment was more than 30 years ago with a roommate. So he and his wife, Denise, were pleasantly surprised during their search for a west suburban apartment after selling their home.
The Whites, who settled into a two-bedroom apartment in Wheaton 121, jumped into staff organized activities as well as ad hoc ones started by residents. On Thursdays, for example, Chris White joins other men in the building to shoot pool and play poker.
We have a great community of friends in the building,” he said, adding, “The really cool thing is we can jump on the train and we can go to Geneva or go into the city and have a great time and not worry about parking.”
Still, advocacy groups like Open Communities and the Center for Neighborhood Technology are concerned about the lack of affordable housing. In the newest buildings, rent is approaching $2 a square foot. The average rent for all suburban apartments in the third quarter was $1.27 per square foot, a price that has continued to rise during the past two years, according to Appraisal Research Counselors.
In response, the advocacy groups are issuing a handbook to municipalities to promote mixed-income neighborhoods near transit centers.
“We were telling all these municipalities during the downturn, this is your time to plan for a healthier local economy and development strategies aren’t just meant for the high end and for your professionals and empty nesters,” said Gail Schechter, executive director of Open Communities. “All this transit-oriented development in the suburbs, by the Metra stations, is all for the high end. The development that we’re seeing is the same stuff that would have gone up before the crash. Before it was condos, now it’s apartments.”
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