Condo Swaps in Itasca
A little over three years after they downsized from a house in Elmhurst to a condo in Itasca, Phil and Connie Mangano are getting ready to move to another new condo—without spending a dollar. With just seven of 70 condos sold at Two Itasca Place, its developer, Don Morris, is converting the building into apartments and moving the Manganos and other buyers there into nearly identical condos next door at One Itasca Place.
In 2008, the Manganos paid $460,000 for a first-floor condo with two bedrooms and an office. They were among the first to move into Two Itasca Place; as it turned out, they were the only ones to occupy a condo on a floor of 14. In fact, nothing in either of the five-story Itasca Place buildings has been sold in over two years, says Pamela Mack, the project’s sales manager. By early 2012, only 55 of 140 units were occupied.
“The developer saw that the future of the second building was as rentals,” Mack says. Because his expertise wasn’t in rentals, Mack says, Morris sold Two Itasca Place to the Naperville-based Marquette Companies. (Paul Conarty, Morris’s lawyer, declined to give any details of the sale.) In order to sell the building, Morris needed approval from the Village of Itasca to change the site’s condos-only zoning so that it would also allow apartments. The change generated some controversy, but it now seems headed for approval.
Morris also had to vacate the handful of sold condos. On January 13, he bought back the seven Two Itasca Place condos and sold six of the former owners equivalent spaces next door at One Itasca Place. “It’s a one-for-one swap,” Mack says. (The seventh buyer sold the condo back to Morris and moved elsewhere, Conarty says.) The Manganos’ new condo will have the same upgrades they had bought for their old place—higher-end cabinets, kitchen appliances, and laundry machines—and it will be two stories higher, providing views over the Eaglewood golf course. (Their original condo looked out on other buildings.) “We’re getting this at no [new] expense to us,” Phil Mangano says. The developer is also covering all moving costs, Mack adds.
Although some Itasca residents argued that converting the building into apartments would mean the property would soon go downhill, Conarty notes that Marquette has explicitly said it wants to hold the building as rentals only until the housing market improves. It would then reconvert the units to condos and sell them off. “They have to keep the property well maintained if that’s their objective,” Conarty says.
Like virtually all real estate in the region, the condos at Itasca Place have lost value since the Manganos and others moved in. Mack says that prices on the remaining condos at One Itasca Place were recently cut by about 20 percent. But both the Manganos and Rosalyn and Frank Sullivan, who are also making the move to the other building, are not concerned. “This is a good deal in a very well-constructed building,” Frank Sullivan says, and that owning in the other building surrounded by renters “would have diminished our value even more.”
The only downside to the deal, the Sullivans say, is that they had to stay in Itasca for the closing and move rather than make their customary snowbird trip to Florida. Given how mild this winter has been, Rosalyn Sullivan notes, even that’s not much of a hardship.
Posted in Housing Bulletin