Newstreet buys Gold Coast office building for $6.8M residential conversion

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2▲0 ▼1Impact / 5
Summary · why it matters

Chicago multifamily developer Newstreet Properties has acquired a seven-story office building at 1165 North Clark Street in the Gold Coast for $6.8 million, with plans to convert it into an 80-unit apartment complex. Newstreet, recently rebranded from Initium Development, bought only the vertically-separated office portions of the building, totaling 74,500 square feet and excluding the ground-floor retail and parking, according to development director Alex Milanoski. The seller, Goldman Sachs, had paid $22.8 million for the entire 110,000-square-foot building in 2015, and separately sold the roughly 18,000-square-foot ground-floor retail space to YFP for $21.3 million in 2022. The deal was financed with a mix of equity and a $5.5 million loan from Chicago-based CRE Bridge Capital, with Newstreet and an anonymous equity partner contributing the remaining $1.3 million. It marks the firm's first office-to-residential conversion, following a year of talks with Goldman Sachs, and Newstreet hopes to start construction by June 2027 with a 12-to-13-month move-in timeline; Eckenhoff Saunders is the architect.

Impact on assets 2

Financials▼ · 1 stocks
Goldman Sachs Group Inc
GS
▼ NegativeCapitalrelevance

Goldman Sachs sold the office building for $6.8M after paying $22.8M in 2015, realizing a large loss on the asset.

Health Care▲ · 1 stocks

Off-coverage companies 4

Newstreet (formerly Initium Development)Private▲ Positive
Capitalrelevance

Newstreet acquired the office building for $6.8M to convert into 80 apartments, expanding its multifamily pipeline.

CRE Bridge CapitalPrivate± Mixed
Capitalrelevance

CRE Bridge Capital provided a $5.5M loan for the acquisition, a financing transaction but no clear positive/negative signal.

Eckenhoff SaundersPrivate± Mixed
relevance

YFP LLCPrivate± Mixed
relevance

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