Terra Nova Properties, based across the Chicago border in the Rogers Park neighborhood, has done 25 vintage multifamily residential rehab projects on the North Side, totaling more than $50 million. Its next project will require at least another $10 million in capital on top of the $2.8-million purchase price, says Vladimir Novakovic.

"I was surprised," Novakovic says of the price his company ended up paying for the three buildings on the northwest corner of Ridge Avenue and Dempster Street.

The property includes a 14,480-sf mansion at 1314 Ridge Avenue used by the school system for its district headquarters. Designed by George Washington Maher, it cost $150,000 to build in 1917, according to Sheldon Good & Co. Auctions, LLC, which conducted the sale for the school district. In addition, Terranova Properties bought a 7,285-sf warehouse at 1311 Asbury Ave. as well as a 5,500-sf food service building.

While the exact number of units will be determined by the city council, Novakovic plans townhomes priced up to $900,000 in addition to condominiums. The group also hopes to build single-family homes along Dempster Street between Ridge and Asbury.

The development would be sensitive to the historic architecture already on site and in the area, says partner Laura Atwood,in charge of designing Terra Nova's projects. "Evanston has a good character and name," she adds. "You're starting out with a good base of a building."

Before paying $103 per sf Wednesday night, the partners began considering the property almost on a whim, Novakovic admits, after another partner who lives in the suburb along Lake Michigan alerted him and Atwood of the auction. Terranova has previously spent most of its efforts in North Side neighborhoods of Rogers Park and Uptown.

Novakovic's family emigrated to the US in 1969 from Yugoslavia. He literally started from the ground up--working for his father, a geologist, as a field technician. After buying his first piece of real estate at 22, Novakovic formed Terra Nova Management Group & Sales in 1991.

The school district is moving its administrative offices into a new $10-million building that also can accommodate early childhood education. Murphy also will miss the character of the Georgian Revival building formerly known as the Dryden Mansion, which includes a library with a fireplace in his office.

"The new building won't have the patina," he says. "I think it's a fair price. We think it's a great property. We think it was a good deal. We think it was a good deal for everybody…This is a good day."

Auctioneer Bruce Sayre says "seven or eight" active bidders were involved from the beginning. The sellers removed the reserve requirement after bidding cracked $1.5 million. "We had agreed on that as a bottom figure," school board president John Chatz tells GlobeSt.com. "We're pleased with the result. We thought we had one of the best sites in Evanston."

The site is on the edge of the city's Downtown area, which is undergoing redevelopment, as well as near Northwestern University.