Richmond Revival

• Add density. Leverage Chicago’s pilot ADU ordinance to add density to an existing property
• Area affordability. Keeps area real estate costs down by increasing density from two units to three units
• Affordable. Owner occupant can offset their mortgage payments with income from the two rental units
• Favorable financing. Low down payment programs for owner-occupied 2-4 unit buildings available through both Fannie Mae and FHA
• Flexibility. A total of three units available for owner-occupant or tenant use
• Lots of light. Extra-wide lot creating permanent southern exposure

We are acquiring and renovating a two-flat property at 1637 N Richmond in Chicago (the “Property”). The plan is to remodel the Property into three distinct units: an “owner’s unit” on the top two floors, comprising a duplex with living space on the second floor and attic; a rental unit on the first floor; and an Accessory Dwelling Unit (ADU) in the basement (the “Project”). The ADU complies with zoning and infrastructure requirements, enabling immediate use as a rental unit under Chicago’s ADU ordinance.

By leveraging Chicago’s ADU ordinance, this project aligns with local housing goals by offering multi-unit properties that offset owner costs with rental income. This approach supports density, affordability, and preserves the multi-unit character of the neighborhood. New owners of the Property will be able to offset their mortgage, enhancing affordability.

The building has approximately 4,275 square feet of livable space across four levels. Units planned include the basement ADU (1,102.95 s.f.) a first floor rental (1,102.95 s.f.) and an Owner's duplex occupying the second and third floors of the building, totaling 2,068.47 square feet.

We plan to enhance the building with the following improvements:

Building layout. Capture the attic into the second floor to allow for dramatically high ceilings in the living area and master bedroom suite.

Modernize. Move kitchens to overlook living rooms and add additional bathrooms to create master bedroom suites. 

Rear porch. Add large windows to create outdoor living space..

Designer finishes. An interior designer will appoint the space with on-trend fixtures and finishes that complement the home and neighborhood.

Existing infrastructure. Utilize the existing structure wherever possible to avoid unnecessary waste and expense.

Strategic updates. Increase property value through strategic updates and by increasing the number of units.

Specific renovation plans include

• Interior improvements. Refinish floors, add dormers, ensure adequate insulation.
• Basement. Increase basement ceiling height by pouring a new slab or underpinning existing foundation wall if needed. 
• HVAC. Install new systems in both the basement and attic.
• Plumbing. Replace cast iron with copper, install new hot water heaters.
• Electric: Upgrade existing systems as per inspection report.
• Exterior: Replace siding, windows, and add a dormer.

Timeline.

We expect the project renovations to begin in February 2025 and to be completed by September 2025.  We will begin marketing the property for sale around April 2025. Historically, properties in this neighborhood have gone under contract within two months and closed within approximately 45 days after that. Therefore we are estimating having the property under contract in November of 2025 with a closing in December. Distribution of funds to investors will follow once the sale is complete.  Our anticipated  timeline is as follows:

• Acquisition. July 2024
• Permitting approvals. December 2024
• Construction start. March 2025
• Marketing start. April 2025
• Construction completion. September 2025
• Anticipated sale date. Sign contract in November 2025 and close in December
   

Robert Linn is a real estate professional and developer whose passion for craftsmanship was ignited in his family's woodshop during his childhood. This laid the foundation for a career dedicated to quality and innovation in the built environment.Robert holds dual degrees in Architecture and Engineering from the University of Michigan, providing an educational foundation that underpins his multifaceted expertise. He began his career in the specialized field of ship design before transitioning into consulting, where he applied his technical skills to the real estate sector. His commitment to continual growth led him to earn a double major in Finance and Management from Indiana University on a scholarship, further enhancing his ability to navigate complex financial landscapes.

While still in college, Robert purchased his first property, marking the beginning of his entrepreneurial journey. Balancing a full-time job and his studies, he launched his own company, Point B Properties, in 2004. Since then, he has been involved in over $300 million  dollars in real estate transactions, providing broad experience in the industry. Point B Properties specializes in the renovation and development of residential properties in Chicago. With experience in architecture, engineering, and real estate project management, the company focuses on transforming spaces to meet market demand. Robert's expertise spans consulting, general contracting, and project management. He is dedicated to quality, efficiency, and integrity, aiming to build long-term relationships with investors and the community.

Robert is not just about building properties; he's about building them right. Recognized for his contributions to energy-efficient building—such as constructing the first Green Star certified condo building—he has a keen interest in the evolving landscape of design and building science.  His dedication is further exemplified by his LEED certification and his role as one of the early adopters of HERS-rated developments.

Infusing his projects with a blend of practical experience, technical expertise, and theoretical knowledge, Robert strives to ensure that each development is innovative, efficient, and sustainable. His multidimensional perspective allows him to deliver solutions that align with contemporary standards and anticipate future market needs.
 

The Project is located in Logan Square, a high-demand neighborhood in Chicago known for its historic charm, walkability, and vibrant local culture. With its mix of trendy restaurants, parks, and convenient public transit options, Logan Square attracts a steady influx of residents, particularly young professionals and families looking for a blend of urban amenities and residential appeal. These qualities, along with rising property values and rental rates, make Logan Square an ideal area for real estate investment.

Market Demand and Property Value Appreciation

As of October 2024, the months’ supply of 2-4 flats in Logan Square stands at three, significantly lower than the 5.5 months’ supply for the greater Chicagoland area. Since a four to five months’ supply is considered balanced, this underscores the strong demand for multi-unit properties in Logan Square. Notably, home values for 2-4 unit buildings in the neighborhood have surged by 10.4% over the past year, reflecting Logan Square’s enduring appeal and investment stability.

Logan Square has been recognized as one of the world’s coolest neighborhoods, celebrated for its blend of accessibility and community-focused amenities. The area boasts a vibrant cultural scene, an eclectic mix of dining and entertainment options, and proximity to public transportation, making it highly attractive to a diverse range of residents. With housing options remaining competitive, this project is well-positioned to capture interest from both owner-occupants and investors seeking properties that promise robust, long-term value appreciation.

Robust Rental Market

The neighborhood’s rental market has grown steadily, with average rents increasing by 5% year-over-year. This rise in rental rates supports stable cash flow potential, with occupancy rates remaining high due to the area’s strong appeal among renters. With a Walk Score© of 91, Logan Square is considered a “Walker’s Paradise” which makes it a top choice for renters who prioritize proximity to public transit, dining, and recreational options.

Financial Incentives for Owner-Occupants

The property is eligible for favorable financing options, which expand the pool of prospective buyers and create additional demand:

• FHA Financing. Allows buyers to finance the property with as little as 3.5% down, reducing entry barriers and making owner-occupancy more affordable.
• Fannie Mae Financing. Allows for 5% down payments on loans up to $1.4 million for 4-unit properties, further enhancing accessibility for buyers who plan to occupy and rent out part of the property.

These programs make the property attractive for owner-occupants, who can use rental income from additional units to offset their mortgage costs, making Logan Square properties especially appealing for new homeowners.

ADU Ordinance and Flexible Use Potential

This property is located in one of Chicago’s few designated ADU pilot areas, allowing for the addition of an extra dwelling unit under the city’s 2020 ordinance. Created to address housing supply and density challenges, the ADU ordinance offers flexibility: the additional unit can be used as a rental, guest suite, or even a workspace. This designation enhances the property’s value and appeal, aligning with city initiatives to stabilize housing prices and expand living options.