Cap rates in the multifamily arena seem to be one of the biggest conversations right now as they are at historic lows. Some experts think cap rates could go even lower in 2015, according to Multifamily Executive. Kiser Group’s Senior Managing Director, Bill Baumann, had some enlightening comments in that recent feature discussing the cap rate limbo. Baumann will also share his state of the market outlook at Illinois Real Estate Journal‘s Apartment Summit on March 10th. But before he does that, we wanted to share a couple of cool facts about him with you:
What being Senior Managing Director of Kiser Group means: I represent investors and owners in the purchase and sale of multi-family and mixed-use properties.
What sets Kiser Group apart from the rest: Ultimately, it’s the people who work here. When a client hires Kiser Group, they not only get the resources of several brokers working for them, but the full company. We have made a strategic decision to be the best in one area of commercial real estate rather than trying to do all things for all people. We do not do leasing or property management, or broker other product types like office or industrial. We are laser-focused on providing clients the most professional and knowledgeable expertise in the sale of Chicagoland multi-family investment properties. That deep, local knowledge of the Chicagoland apartment market is what sets us apart.
Working on anything exciting: I’m currently working on the sale of a 164-unit, high rise building at 7100 S. South Shore Drive overlooking Lake Michigan, which we recently put under contract. Originally built as a hotel in the 1920’s, the property was converted to its current use as apartments in the 1950’s. It’s a great example of the plethora of vintage Chicago apartment and hotel product that was built after Chicago’s Great Fire and before the Great Depression and which still constitutes a majority of the apartment stock in Chicago neighborhoods today. I’m also working on a portfolio sale of three apartment properties located in the Hyde Park neighborhood near the University of Chicago. Few properties come up for sale in Hyde Park, particularly on campus, as owners tend to hold these properties longer-term, so it’s a unique assignment from that perspective, not to mention the significant amount of new development and activity that is taking place in Hyde Park today.
Most memorable project/deal: Working on behalf of an institutionally sponsored client, Newcastle Limited, to structure and close a $122,500,000 portfolio acquisition of seven Chicago apartment properties, the largest of which was $56,000,000. The seller, Wexenthaller Realty, had assembled the portfolio over a span of thirty years and felt it was the right time to sell. As it turned out, they were correct as months later the Great Recession hit. For Newcastle, who is a long-term investor, the investment gave them a strong foothold in the attractive Lincoln Park and Lakeview rental markets, neighborhoods that have since seen values not only return but far exceed pre-recession levels so the transaction worked very well for all parties involved. I think it also represented the beginning of a shift in the market which has continued since, in which ‘institutional’ money has increasingly targeted what was previously considered private market, vintage product.
First CRE job: My first CRE job was with a local apartment syndicator and developer. At the time, we were involved with a development about 45 minutes from Chicago in New Buffalo, Michigan geared toward the affordable vacation home market. We had re-zoned a large agricultural parcel to residential, subdivided it and sold very affordable yet customized cedar-sided cabins as part of a large homeowners association. Cabins were priced below $200,000 on average and included use of numerous amenities, including two pools, a lake and a clubhouse. Coming from the banking industry before this, the job really showed me how entrepreneurial and diverse the real estate industry can be.
Greatest advice ever given: Pursue what you love, not what others want for you or what you think is expected of you. Do what you have a passion for and more often than not, success will follow.
Daily habit: I review my deal pipeline daily to make sure I’m balancing the different needs of our business and clients. In many ways, brokerage is a simple business … list deals, market deals, close deals. Making sure you’re doing all three and doing them well however takes work so I try to keep focused and balanced on each as much as possible.
Family facts: I’ve been married five years to my wife, Lindsay, who is originally from Chicago. I’m originally from Cincinnati but have lived in Chicago since 1997 when I moved here from San Francisco to go to business school at Northwestern. We have two children, Will and Margot, and live in the Lakeview neighborhood close enough to Wrigley Field to hear the cheers, but far enough not to get the crowds.
Interesting fact about yourself: When not working or spending time with my family, I enjoy playing racquet sports including tennis, paddle tennis and squash. In college, I was the captain of the Yale Varsity Squash team and a member of a team that won the Division 1 National Men’s Squash Championship.
