The new owner of a long-fallow site in downtown Winnetka is looking to high-net-worth empty nesters to fill the dozens of apartments he plans to offer at monthly rents of $7,000 to over $12,500.
“People who are transitioning out of their $5 million, $7 million houses but don’t want to leave Winnetka” are the target market for the 59 units John Murphy’s Murphy Development Group plans for the site at Lincoln Street and Elm Avenue.
In past years, many of them would have moved into the city, but “the demand is here (in Winnetka) since COVID,” Murphy said.
Since the village approved Murphy’s plan for the site in March, “we’ve been getting calls saying, ‘Can I reserve a unit now?’ ” Murphy said. If construction goes as planned, the 59 units will be ready for occupancy in spring 2027, he said.
The Winnetka project isn’t the first to benefit from North Shore empty nesters’ newfound distaste for moving downtown because of issues with crime and the slow return of restaurants and other amenities.
A developer in Highland Park told Crain’s in May that his condos priced at $3 million and up — four of seven of them under contract long before construction is finished — appeal to a group who “have stopped moving into the city.”
In Winnetka, “the level of luxury is going to be high,” Murphy said. “Winnetka has never seen anything like this pricing.”
Listed for rent today on Zillow in Winnetka were half a dozen apartments and townhouses with monthly rent of $1,600 to about $3,700, and a 20-room mansion for $43,500 a month.
Murphy’s firm and a partner, capital executive Christopher Merrill, announced in recent days that they have purchased the 1.21-acre site. Murphy would not disclose the price.
A source close to the deal said the buyers paid $14 million to Romspen, a foreclosure affiliate of a commercial lender in Toronto. Romspen acquired most of the properties in a court-ordered sale in 2021 and bought one piece, a former pharmacy, in a conventional transaction in 2023.
The source said Romspen had about $29 million in debt on the properties, which would mean the sale to Murphy was at less than half the debt.
The site, less than a block from a Metra station, contains six low-rise commercial buildings, which have stood empty and unused while the redevelopment was in limbo. They’ve been vacant for at least seven years, a village official told Crain’s earlier this year.
It's been 17 years since developers first started proposing redevelopment for the block. The first proposal fizzled in the recession of 2008. Another developer bought the site in 2012 and rolled out a plan for 120 units, later shrinking it to 70 and then to 61.
That $98 million plan collapsed, leaving what the village president, Chris Rintz, told Crain’s at the time was “a horrible black eye” in a central location in town. (Rintz did not respond to a request for comment on the Murphy plan.)
In 2020, a third development firm, one with family ties in Winnetka, announced a plan to pick up the project but never moved forward.
Murphy said village officials played matchmaker between his firm and Romspen, knowing his success reviving a stalled luxury apartment project in Skokie and his track record of developments including the 47-story Paragon apartments in the South Loop and the 39-story condo tower Lincoln Park 2550.
Construction will likely start in the first quarter of 2025, Murphy said.
The plan is a four-story building with 59 apartments and 20,000 square feet of ground-floor commercial space. The building will have 152 indoor parking spaces, 32 of them on the ground floor set aside for public and commercial use in a deal with the village. The rest will be for building residents.
Unlike the turreted, Francophile design of the biggest plan to sputter on this site, Murphy’s project, designed by the Chicago firm OKW Architects, has a contemporary take on a Tudor exterior.
While the interiors will be more modern, the historical mix of half-timbers, plaster walls and steep roofs that characterize the Tudor style “is an aesthetic program that has been established and worked in downtown Winnetka for almost a century,” Murphy said.