john greene Commercial, a brokerage firm with a 39-year history in the Chicagoland market, announced it has introduced a model to bring private production homebuilders back to work after the recession severely damaged the industry. Through a strategic partnership structured by john greene Commercial, the model links capital resources with local homebuilders for a number of planned residential developments in Chicago’s western and southwestern suburbs.
“Our firm has been working with private homebuilders since 1976, many of whom are family-owned businesses like ours, so to see so many leave the industry after the market crash was painful,” said Tim Greene, CEO of john greene Commercial. “We’re in a position now to help get them back into the market, and we’re proud to do so.”
In Chicago, the number of private homebuilders with 10 or more starts went from 636 in 2005, to only 63 in 2014. “Although the market is improving, private builders are still struggling to finance their own projects as they had done before the recession,” said Greene. “That’s why we needed to implement a model to deliver financing for the private builders and returns for the investor.”
john greene Commercial recently implemented this model when it linked Turnstone Group, an investment management firm based in Atlanta, Ga., with Wheaton, Ill.-based homebuilder Next Generation Development for the construction of Springbank, a 99-unit residential community located in Plainfield, Ill. “Turnstone’s stellar reputation and shared desire to work with both private and public builders made them an ideal capital partner for this project. And with our firm’s four decades of experience in land, residential and commercial brokerage throughout these communities, we are able to line up the most appropriate homebuilder specific to each development,” said Greene.
Springbank is scheduled to open sales this fall, with single-family homes starting in the high-$200,000’s. Joel Kirstein, senior vice president of john greene Commercial, says building mid-range product will have a significant impact on the area’s housing market, which typically attracts first-time and move-up buyers.
“Until now, we’ve only seen institutions investing in entry-level new-construction housing that they acquire after it’s built and then rent it out. This is the first model where it’s strictly for-sale, owner-occupied housing,” said Kirstein. “We expect demand for this price point to increase, particularly as millennials, who are on track to become the largest demographic in the country, come off the sidelines and into the housing market.”
According to Kirstein, Springbank will mark the first of several developments to leverage this model. “This model has ushered in our region’s new normal, where private builders have access to capital, and middle-income buyers have access to product,” said Kirstein. “You can expect to see a surge in private production builder housing construction over the next couple of years as we continue to deploy this model, and others follow.”
About john greene Commercial
Naperville, Ill.-based john greene Commercial is a full-service commercial brokerage and advisory firm with a 39-year history. Led by the founder’s son, Tim Greene, john greene Commercial has a strong reputation as a leader in the land investment and development market, specializing in serving private wealth, investment fund and builder clients in the acquisition, sale and leasing of land and commercial holdings. For more information, visit johngreenecommercial.com.
john greene Commercial announced it recently introduced a model to bring private homebuilders back to work in the Midwest. (photo: Shutterstock.com)