"Chicago remains a challenging market to operate in," says chief operating officer J. Lindsay Freeman. However, the condo conversion market remains robust, he and chairman and chief executive officer R. Scot Sellers add. "We expect to sell several of our assets here at attractive cap rates."

However, the REIT realizes its selling opportunity may be short-lived. "We feel the condo-conversion sales window is a finite phenomenon," Sellers says. "It always comes to an end, and typically, very abruptly."

Chicago remains one of the hotter condo conversion markets Archstone-Smith Trust is familiar with, with Washington, DC, San Francisco and Southern California also seeing robust activity. "Chicago is the market that's probably the longest in the tooth, and has a lot of new construction," Sellers adds.

Having already sold the 457-unit Plaza 440 for $107 million, Archstone-Smith Trust has the 480-unit Park Millennium at 222 N. Columbus Dr. on the market. While Holliday Fenoglio Fowler is marketing that building, Archstone-Smith Trust has hired Newcastle Limited to sell a 2.4-acre development site across the street. That parcel is part of the 28-acre Lakeshore East master-planned community, as well as one of the largest parcels of undeveloped downtown land in a major US city.

"The land is already zoned and ready for the development of residential apartments or condominiums," says Newcastle Limited director and project manager Martin F. Jablonski.

Instant Insights /

Archstone-Smith Capitalizing on Condo Craze

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