Wednesday, November 04, 2015

Classic brick two-flat on Schubert, Lincoln Park sells for $1,090,000 torn down for new construction

738 W Schubert will be one of the latest new construction houses in Lincoln Park (photo Eric Rojas and Bob DePalma, Brokers, Kale Realty)

This Google Maps image shows the original (and quite charming) brick two-flat at 738 West Schubert in the center. There are many properties I don't mind seeing "go" but this one hurts a little. Maybe it's my bias towards homes with vines growing on them.
The 700 block of West Schubert is narrow residential street cutting through eastern Lincoln Park neighborhood from bustling North Clark Street to North Halsted in the 43rd Ward.  The strip between two busy commercial areas is full of new construction houses, condos and some remaining small multi-unit rental buildings. The 700 block of West Schubert maintains a cluster of original properties (one less now). I have a lot of  fond business and personal history in this area and it has just exploded over the years.

According to public sales records the 738 W Schubert property was purchased in July for $1,090,000 by developer Barrett Homes LLC.  MLS listing show the two above grade units in the building were renting at $2,500 minimum and there was also a garden unit that rented out.  Probably a minimum of $1,200 or so for that.  I'd estimate the rental income with the parking spots at about $6,500 a month. 

$1,090,000 for the "land" is reasonable. The lot is much deeper than an average lot (about 161 feet deep). The average cost of the units would work out to about $363,000 a unit.  That may be a little high depending on condition of units if they were condos sold separately but land is at premium in this location. 

The construction permit has the project estimate at about $656,000. With the median sold price of homes at $1.5 million this year for all of Lincoln Park and the median price of homes under contract at $2.5 million... a roughly $1.8 million investment to build on speculation is what it takes.

712 W Schubert Ave, Chicago, 60614 on the block just sold in August of this year for $2,875,000.  The 2009 ornate brick and stone home is on a 25'x161 lot about 5 homes down on the same side of the street. Basically, if the total investment on the new construction home is $2,000,000 to $2,250,000 (land, construction, taxes etc) the developer stands to make a great return.

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