Marketing a million-dollar condo: Is the Gold Coast going soft? | Neighborhood News | Chicago Reader

Marketing a million-dollar condo: Is the Gold Coast going soft? 

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A few years back, the duplex condominium in the turn-of-the-century Astor Street mansion would have sold only days after its owner put it up for sale. After all, the upscale real estate market was sizzling then, and the unit is a perfect location for any social climber eager to broadcast his rise to the top.

But the unit at 1500 N. Astor St.--with its $1.175 million price tag--has been on the market for almost two months with no offers to show. The current owner--the retired head of a Chicago-based conglomerate--will soon move to a new home: another million-dollar condominium, this one in a high rise overlooking the lake. The broker handling the Astor Street unit isn't panicking, but he is shifting tactics. No more private listings: he's drumming up publicity and sending out press releases in the hope that with enough articles and television coverage the whole city will hear of his "exclusive listing."

One of his releases landed on my desk and I went over to take a look.

"I've never sold a building with newspapers before," says Clayton Rautbord, sales manager for Howard Ecker Residential Organization, Inc., the north-side real estate company responsible for the sale. "But things have been a little slow, so we decided to change our approach."

There's no question that the condominium--the largest and most prestigious in a nine-unit building designed by Stanford White--is valuable. It's one block from the lake and too close to other valuable real estate not to be.

But is it worth the asking price? Are there enough barons of commerce and industry, heirs and heiresses, celebrities and sports stars in town to buy all the other million-dollar real estate competing for their funds? Could it be that the Gold Coast--the strip of exclusivity squeezed between Lake Shore Drive on the east and Clark Street on the west--has gotten too pricey for its own good?

Rautbord says no. And most of his colleagues in the real estate business agree. "Real estate is still big," he insists. "A few years ago I sold a studio on the 100 block of Walton to a young lawyer for $40,000. He fixed it up and sold it for $50,000. Now guess what. He's going into the real estate business. He figures where else can you make $10,000 so quickly."

"Condominium sales in this area are at their very best," adds Annetta Gray, senior vice president at Rubloff, another real estate firm. "We have a slow market in July and August--but that's just the norm. Overall, this has been the year for condos."

Of course, no broker ever got rich underestimating the value of property. And no sane salesman would publicly admit that the rising asking price of real estate has gotten out of hand.

"If your market's hot, you don't need articles in the newspaper," says one north-side real estate salesman, who prefers to remain anonymous. "In fact, it may be better to avoid publicity. Who needs a bunch of reporters and cameramen walking around your client's house anyway? But if the market's not so hot, you have to build interest. That's what newspapers are for."

In any case, the condo on Astor is an intriguing piece of property. A native of New York City, Stanford White designed it while working on the 1893 world's fair. The home was built for Robert Patterson, then the owner of the Chicago Tribune. Later, Rautbord says, the building was purchased, enlarged, and occupied by Cyrus McCormick, inventor of the reaper and owner of International Harvester Corporation.

"White used an Italian Renaissance style on the building," says Rautbord. "He had it built with narrow Roman-brick trim and various shades of orange brick."

At first it had only other mansions for neighbors. In the 1920s, however, developers bought up huge chunks of lakefront property and started building high rises.

These new buildings had the aura of exclusivity. They featured enormous apartments--usually one 3,000-square-foot unit per floor. "The high rises along this part of Lake Shore Drive have always been among the most valued property in the city," says Rautbord. "I would say 1500 N. Lake Shore Drive is the most prestigious building here. That's where the late Governor Ogilvie used to live. Marshall Field used to live there; I don't know if he still does. It's a co-op, and apartments go for $500,000 to $2 million."

The high rises could not help but affect the value of the homes that lay in their shadows. They took from the mansions their view of the lake, blocked their sunshine, and reduced their value by adding to the area's traffic and congestion. With soaring taxes and utility costs, a mansion in the area was no longer a prudent investment. Many wealthy families packed up for the north suburbs, where rigid zoning laws and vigilant brokers made sure that high rises were kept out.

As a result, some of the mansions fell into disrepair; others were converted into schools or boardinghouses. The area west of Clark Street--traditionally a lower-income Italian neighborhood--became home to blacks and Puerto Ricans. By the early 1960s, the Gold Coast threatened to become a slum.

That was when real estate magnate Arthur Rubloff had a vision. Backed by multimillion-dollar federal and local subsidies he cleared the area along Clark from North to Division and built Carl Sandburg Village: a colony of high rises. It was billed as upscale living for young professionals making the urban scene. The subsidies enabled Rubloff to keep rents relatively low. In time, the units were filled. The complex went condo a few years ago.

Sandburg ignited a Gold Coast land boom, as it "protected" properties east of Clark from the poor. Most important, Sandburg helped make the Gold Coast fashionable again. Developers gobbled up every empty lot--tearing down old mansions whenever they could--and erected high rises, which they marketed as high-priced rentals or condominiums.

"The big turnaround for this area was when people learned how to market condominiums," says Rautbord. "You take a look at the building to the west of here. It's a recent high rise that originally went bankrupt. The people who bought it got it for a bargain-basement price. Now units there are selling for a quarter of a million dollars. The key is marketing."

The Patterson mansion was part of the condominium trend.

"It was a private grade school after the McCormicks left. Then about eight years ago it was converted into nine condominiums," says Rautbord, leading a tour of the unit. "This is the prize unit. It's the only duplex, and it has a roof deck for parties."

The 3,000-square-foot unit has six rooms: a living room, a dining room, a kitchen, a master bedroom, and two smaller bedrooms that could also serve as libraries or work rooms. At the moment, it's difficult to appreciate the glory of the unit. There are moving boxes in almost all of the rooms. It's neat and well kept, but obviously the current owner has not given much thought to interior design. "Personally, it's not decorated the way I would want," says Rautbord. "The owner--who has asked not to be identified--has different tastes than I do. Like his choice of wallpaper. He goes for this beige stuff; I would prefer if he would leave the walls white. Or the kitchen. He has these lovely wood cabinets and then he paints the walls pink and puts linoleum on the floor.

"He's a super guy--he really is--but he has different tastes than a lot of the people who would be looking at this unit. I know a lot of the women who see this unit don't like the design. I try to prepare them beforehand. I tell them that the owner is a bachelor who has 'masculine tastes.' I try to be discreet."

The strongest selling point may be the second floor with its master bedroom and bath.

"It has a lakefront view," says Rautbord, standing in the bedroom. "If you stand over there by that bookcase and look through the window between those two high rises you can see a patch of the lake. Well, it's not a great lakefront view. But don't worry--we don't make a big deal about it.

"And how about this bathroom! It's got a master bath, travertine floor, a double vanity, a double size tub, a shower stall, and a skylight. That's a nice bathroom."

In the same neighborhood, however, at least a dozen other units in mansions (or mansions themselves) are also for sale--each costing well over one million.

"I don't think there's a glut here, I really don't," Rautbord insists. "There's still a strong market. We had an open house here about three weeks ago and over 100 brokers showed up. That's a fantastic turnout. That shows there's a lot of interest."

But shouldn't such classy real estate be shown more discreetly?

"There's different ways of selling real estate," says Rubloff's Gray. "I think the multiple-listing services are still the best way. You're spreading the word through 4,800 salespeople on the north side. But I agree, it's a little different if you're operating in a million-dollar market. We are in the midwest and the sad thing is that we may not have as many million-dollar buyers as we'd like. Sometimes you have to do different things to target your market. But that's all I'm going to say. If I tell you any more, I'd be giving away my secrets."

Clayton Rautbord is also optimistic.

"Listen, the real estate business requires patience," he says. "You can do nothing for weeks and then sell three or four properties in a day. On this deal, I only need one buyer. That's all. Somewhere out there is a millionaire for whom this place is right. I suspect our buyer won't even need a mortgage. He'll just cash in some stocks and pay for this unit in cash."

Art accompanying story in printed newspaper (not available in this archive): photo/Jon Randolph.

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