This bank owned, approximately 1,450 sf commercial condominium unit located in Chicago’s South Loop had been listed for sale for over a year with an asking price of $169,000.
1133 South Wabash Ave, Unit #C2, Chicago, IL
Bank Owned Real Estate
Sale Price: $194,250
This bank owned, approximately 1,450 sf commercial condominium unit located in Chicago’s South Loop had been listed for sale for over a year with an asking price of $169,000. Since the traditional for sale listing had generated only a few lowball offers, the bank decided to engage AW to auction the property.
This street level retail/office condo unit was in a high visibility location and fully leased, producing rental income of $2,760/month. However, the tenant’s lease expired July 31, 2015 and contained a five year renewal option that the tenant had not yet exercised nor indicated any intent to exercise. As such, potential purchasers who were end users were discouraged by the remaining term of the lease and investors were discouraged by the lack of certainty regarding potential lease renewal and continuing cash flow.
The AW team recommended a minimum bid of $100,000, in order to generate maximum interest in the property. The AW team featured extensively target marketed and advertised the property for auction. Shortly after the AW team concluded it initial target marketing campaign, the AW team received an offer of $165,000 from a prospective buyer who had previously looked at the property. Since this was by far the highest offer the bank had received to date, the bank was ready to accept this offer. At the advice of the AW team, the bank did not immediately accept the offer but instead let the AW team conclude the rest of its advertising, PR and target marketing efforts for the auction while remaining in weekly contact with the prospect who continued to be the high bidder with a bid of $165,000.
The AW team’s extensive target marketing not only generated more showings than the property had previously enjoyed, but also identified 10 qualified bidders. After all of the advertising for the property had run, and approximately 3 weeks before the online auction was scheduled to begin, the AW team advised the bank to allow the AW team to call for all best and final offers. The bank asset manager concurred and the AW team was able to ignite a pre-auction bidding war. This bidding war resulted in five offers, including an offer of $194,250 from the prospective buyer who previously had offered $165,000. This ultimately resulted in a high bid and sale of the property for $194,250. The sale of the property closed within four weeks, with a sale price 94% greater than the minimum bid set for the auction and 49% greater than the most recent offer for the property.