LOGAN SQUARE — A non-profit developer has purchased the a single-room occupancy apartment building, the first deal to take place under an SRO ordinance passed last year.
Full Circle Communities, the developer, purchased a 34-unit SRO apartment building at 2611 N. Sawyer Ave. for $1.45 million and plans to keep the building running as-is.
The ordinance passed last year was touted as a solution to a "crisis" that left many homeless or displaced as SROs are sometimes considered a "housing of last resort" for people who are poor. There are just 77 SRO buildings left in the city compared to more than 1,000 at the housing type's peak.
"Preserving this much-needed asset, especially in a market with rising housing costs, is critical for maintaining the diversity of the Logan Square neighborhood,” said Joshua Wilmoth, vice president of Full Circle.
The ordinance forces any seller of an SRO to notify the city and in turn provide a six-month window for developers who wish to continue the SRO or turn it into affordable housing to bid.
"There's essentially a block on them selling to somebody who is not going to preserve the property as affordable housing," Wilmoth said.
Residents of the building at 2611 N. Sawyer Ave. currently pay between $400 and $450 a month. Those rates won't change under the new ownership, according to Wilmoth.
Under the SRO ordinance, Full Circle will allow all existing tenants to remain, and once a tenant moves out, any new renter would be restricted to earning at or below 50 percent of the area median income.
As part of the financing, the lender is requiring that nine of the units be made available to people earning at or below 30 percent of the median income.
Wilmoth said he hopes the project serves as an example for other real estate companies and developers that preserving SRO buildings is a realistic possibility.
This project in particular was a good candidate for the first case under the new ordinance because the building was in excellent condition, according to Wilmoth.
"This is our first SRO so we are going to learn by doing, and we wanted to make sure it wasn't an overly challenging project," he said.
Mayor Rahm Emanuel, in a prepared statement, said he commended the developer for preserving the housing for those who need it the most: "In 2014 we worked with the Chicago for All Coalition to pass the SRO Preservation Ordinance to ensure that these buildings remain viable affording housing options for residents across the city."
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