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PERSEVERANCE AND PRECISION MARKETING LEAD TO THREE-PROPERTY SUCCESS ON DEVON

The Opportunity

In 2023, Kiser Group brokers Andy Friedman and Jake Parker were approached by a client with a unique assignment: sell a portfolio of three mixed-use buildings on Devon Avenue near Loyola University. All three properties were constructed in 2016 and acquired by the client in 2022 after the original developer lost them to the bank during the pandemic. Though stabilized after a year of ownership, the properties came with complex challenges that would test any broker’s patience and strategic creativity.

The Challenge

  1. Interest Rate Volatility:
     The properties were initially valued in late 2022. By the time they launched in early 2023, interest rates had increased by 50–75 basis points. Over the following months, rates continued to climb, pushing prices down and buyer interest further out of reach.
  2. Mixed-Use Complexity:
     While the buildings featured desirable layouts—modern, oversized 2–3 bedroom apartments—each had a heavy retail component. Approximately 40% of each building’s income came from a single commercial tenant, which deterred both apartment and retail investors. Multifamily buyers typically avoid commercial spaces, while retail-focused investors tend to shy away from managing residential units.
  3. No Value-Add Angle:
     With the properties being recently built, there was limited opportunity to “add value” in the traditional sense. In a market where most buyers seek renovation upside, these stabilized assets lacked appeal on the surface.

Strategic Pivot: Auction Attempt

To expand exposure, the Kiser team partnered with a national auction platform to attract more eyes and generate urgency. After months of preparation and follow-up, the auction day flopped—only one bid was placed across all three assets, and it fell far below reserve.

Despite the setback, Friedman and Parker didn’t give up.

The Solution: Repackaging and Repositioning

After pulling the listings, the team regrouped. Instead of continuing to market the properties as a portfolio, they re-listed them individually. This not only made the deals more accessible to smaller buyers, but also allowed Friedman and Parker to tailor marketing efforts to different investor types.

Kiser Group’s Marketing Engine Delivers

All three eventual buyers were completely new to the Chicago multifamily market and were sourced through Kiser Group’s marketing:

Building One – Passive Investor from Columbus, OH:

A doctor looking for yield amid a tightening Columbus market responded to Kiser Group’s email outreach. Coincidentally, Friedman had an upcoming trip to Columbus and arranged a face-to-face meeting, building a relationship that gave the buyer confidence to move forward.

Building Two – Suburban 1031 Buyer:

A small investor completing a 1031 exchange was drawn in by the stabilized income and wasn’t deterred by the retail element. Though unfamiliar with new construction and urban mixed-use, Friedman and Parker provided detailed guidance to help close the deal.

Building Three – Chicago-Based Retail Owners:

A father-son team with significant retail holdings but no multifamily experience stepped in. Their comfort with commercial tenants balanced their uncertainty about apartment operations—Friedman and Parker again played the role of educators and advisors throughout the process.

Key Takeaways & Broker Insight

Perseverance Pays Off:
 The process spanned 21 months from initial valuation to final closing. Friedman and Parker’s refusal to give up—despite interest rate hikes, failed auctions, and a thin buyer pool—proved crucial.

Targeted Storytelling Overcomes Lack of Value-Add:
 Without the ability to renovate or reposition, Friedman and Parker reframed the opportunity:

  • “You’re not competing with 100-year-old buildings.”
  • “Tenants pay all utilities.”
  • “Students essentially do the leasing for you.”
  • “Consider offering furnished units to boost rent and simplify turnover.”

Marketing Machine as a Pipeline:
 Despite the odds, all three buyers came directly through Kiser Group’s marketing reach—not existing relationships. This underscores the firm’s ability to capture attention and convert it into real deal flow, even in challenging situations.

Author:

Kiser Group Staff