Jonathan Rose Cos. acquired Englewood Gardens, a portfolio of apartments in Chicago’s Englewood neighborhood, and plans to preserve it all as affordable housing. It’s the latest in a series of Chicago purchases by the New York City-based investor, and company officials say they have the financial weight to preserve and renovate thousands of local units.
The firm partnered with local development firm 5T Management to acquire the 13-building, 167-unit, dispersed-site Section 8 property for $10.7 million from affordable housing developer Anthony Fusco.
“(Residents) will be excited that someone cares enough about them to put money into their homes,” said Steve Thomas, director of acquisitions and development at 5T. “That’s what builds communities.”
Jonathan Rose is becoming a major player in Chicago’s affordable housing sector. By the end of the year, he will own more than 2,000 affordable and mixed-income apartments in the Chicago area, according to Nathan Taft, partner and senior managing director.
The goal of the company is not just to make a profit. Taft says he lures investors by promising that he will also pump needed funds into older properties to improve residents’ lives.
“Our goal is to repair the fabric of communities, and that always starts with providing good affordable housing,” said Taft. “In the US, it’s quite shocking that you can walk five blocks in one direction and find completely different life outcomes.”
Jonathan Rose purchased Englewood Gardens with his $525 million Rose Affordable Housing Preservation Fund V. In a one-year renovation, it will install energy-efficient features like LED lights and better-insulated ceilings, lower residents’ utility bills, and add new cabinetry and flooring. and make fire and safety improvements.
“Right now, we’re planning to spend up to $1.7 million,” Thomas said. “But we have access to other capital if needed.”
Fusco will retire and sell his entire affordable housing portfolio, much of it to Jonathan Rose, according to Max Jawer, director of acquisitions for Jonathan Rose. In 2020, the company purchased Fusco’s Pheasant Run/Hunter, a 176-unit Section 8 community in Orland Hills, followed by the 2021 acquisition of Lake Grove Village, a 458-unit high-rise on the South Side.
In 2022, it bought Archer Courts, a 146-unit Section 8 community in Chinatown, from Fusco for $11.6 million, and later this summer expects to close on the purchase of Fusco’s Barbara Jean Wright Court Apartments, a low-rise building. height of 272 units. , Section 8 development at 1354 S. Morgan St. just north of Pilsen. The company also plans to purchase Fusco’s 51st and King Drive apartments, a 96-unit Section 8 community at 5035 S. King Drive in the Grand Boulevard neighborhood.
Local officials praised Jonathan Rose for preserving Englewood Gardens, which will be managed by 5T, and for committing to improving conditions.
“We want longtime residents to maintain their place in the community, and the Rose property ensures long-term affordability for existing tenants and will provide the extensive renovation that will greatly improve Englewood Gardens and the quality of life for all of its residents. ,” South Side Ald said. Roderick Sawyer in a statement.
Founded in 1989, Jonathan Rose now owns around 18,000 units across the country. He has developed or acquired more than $3.2 billion in real estate. Throughout the Chicagoland area, 5T Management owns or manages more than 1,000 units, including affordable and market-rate housing.
Chief Executive Officer Deona Thomas of 5T Management said the companies’ association was natural. They have known each other for more than a decade and for years sought to collaborate on mutual goals, including improving communities like Englewood.
“We want our residents to feel proud of where they live,” he said. “That is the ultimate goal.”