Both The Chicago Tribune and The SouthTown Star recently reported that MACK Companies bought the Fay’s Point Housing development project in Blue Island, Illinois. The development was purchased for $1.5 million and 27-acre site is situated comfortably between the Little Calumet River and the Calumet Sag Channel. MACK will start work in the third quarter on eight of forty-four additional lots. The deal also includes developable land that could accommodate up to 236 housing units.
MACK Companies would like to congratulate our partners at American Residential Properties (ARPI) on raising $287.7 million in an initial public offering. ARP sold 13.7 million shares at $21 each and told Bloomberg that the proceeds from the offering will be used to grow its business in the single-family home rental market.
MACK Companies’ VP of Sales and Marketing, Eric Workman, was interviewed on Fox Business News yesterday regarding single-family rentals in the Chicago-land area. This report by Fox comes in the light of increased interest in MACK’s business model as well as MACK Companies. Mr. Workman also spoke about the area’s economic diversity and a more fragmented housing supply that differs in many ways across the landscape.
Chicago Real Estate Daily just released an article today which speaks about how Chicago may not be the most profitable place to buy and rent single-family homes but it is nothing to sneeze at. In fact the Chicago-land area fares well against most other large metropolitan areas. On the average a cash buyer of a three-bedroom home in the Chicago area receives a 7.2 percent initial yield according to RealtyTrac Inc. While the price increases have begun here just as they did in California and elsewhere, the yields haven’t dropped as much.
CBS 2′s Derrick Blakley released a detailed report yesterday regarding MACK Companies‘ ability to transform foreclosed properties into move-in ready single family rentals. MACK has bought more than 1,000 foreclosed houses, renovated them and rented them out to new tenants. “When you’re doing the same thing to all the homes, it’s almost like an assembly line,” said Eric Workman, MACK’s VP of Sales and Marketing.
We feel great about such coverage because it speaks to the value of our business process. MACK Companies helps raise property taxes for governments, property values for neighbors and has the ability give new hope to renters, who then have the option to buy their home.
MACK Companies was more than pleased to discover that it had been declared a winner by MSN Real Estate. This comes as no surprise after experiencing a record year in which we acquired more than 200 homes in Chicago’s south and southwest suburbs. Eric Workman, Vice President of Sales and Marketing was quoted as saying “Owning a single-family home as a rental used to be a big mom-and-pop thing, with the owner managing it, this is really the first time in history you’ve had this much opportunity, this much rental demand and desire from very big Wall Street funds.”
The Wall Street Journal ran an article this week regarding early sellers scoring big from selling off properties in bulk. The Article’s author, Nick Timiraos, used MACK Companies as an example pointing to the sale of 196 homes to a Scottsdale, Arizona, based real estate investment firm, American Residential Properties. This record deal leaves little doubt that single-family rental homes are now one of the hottest asset classes.
Institutional investors have come to value foreclosures, which can be given new life as rental properties. Nationally homes prices have continued to rise by 6% while much of the nation’s inventory continues to shrink. The perfect combination of economic factors makes Chicago one of if not the best location to invest in single-family rental homes.