'Critical Mass' May Carry Downtown Condo Market

Adds former Chicago alderman Theodore C. Mazola, president and co-founder of New West Realty, "It's great the city has condominiums because it does add stability to neighborhoods," Mazola says. "When people put their money where their mouth is, it's a whole different animal."

In a separate presentation earlier this month, Gail Lissner of Appraisal Research Counselors predicted improved traffic and sales velocity at condominium offices, fewer sales to speculators and developer optimism in 2002. The last point was amplified that same day less than a mile away, where the city plan commission recommended approval for more than 1,000 new and renovated units in multiple proposals for Downtown sites.

"Well-conceived projects will get their share of the market," Lissner says. However, buyers perceive the pendulum has swung back to their side, Lissner says, taking any sense of urgency out the market that not too long ago saw quick sell-outs of projects.

Appraisal Research Counselors reports 4,173 unsold condominium and townhouse units on the market as of the fourth quarter. "It can be a scary number," Lissner says. However, that includes 1,870 units yet to be built. "A lot of these deals may not get done."

However, Carley says his firm is finishing a month that saw three times as much activity as the previous four following Sept. 11. "We had a better fourth quarter than we had in the third quarter," Mazola adds. "People want the stability, whether it's (first-time) homeownership or a move up. People are realizing housing is a good investment. And they like the inner city because they don't want to travel an hour and a half to work."

Fueling the demand long-term, Carley believes, is a 1.5-million population that is at least 55 years old. Many of them already are trading in their suburban homes for Downtown condominiums.