Billionaire Sells at a Loss as Chicago’s Luxury Homes Struggle
Chicago’s luxury real estate market has been in big trouble since 2021.
Now, even billionaires are selling their homes at huge losses. Crime in the city is rising; many believe this is part of the problem.
Recently, Ken Griffin, a billionaire and CEO of Citadel, sold two penthouse floors in a fancy building called No.9 Walton.
He originally paid over $34 million for them in 2017 but sold them for only $9 million and $10 million—a loss of 44%.
Griffin blamed “bad political leadership” in Illinois for the city’s troubles, criticizing Democratic Governor JB Pritzker.
He said the drop in Chicago’s home values hurts everyone in the state.
Luxury homes in Chicago are selling differently than they used to.
Homes over $4 million sell 28% less often and the median price of those homes has dropped from $5 million to $4.625 million.
Meanwhile, prices for fancy single-family homes have gone up in the suburbs.
Still, luxury condos in the city are struggling the most.
Real estate experts say this decline started in 2020 during the COVID-19 pandemic.
Chicago faced strict lockdowns, protests, and even looting after the murder of George Floyd.
While other cities have bounced back, Chicago’s high crime rates have scared away buyers and businesses.
Crime in Chicago is still a big problem. While murders are down 26% this year, overall crime has jumped 36% since 2020.
This has hurt downtown real estate, especially luxury condos.
Many people who once planned to downsize and move downtown have chosen to stay in the suburbs or move to safer places like Florida.
Griffin even moved his company, Citadel, to Miami in 2022, saying crime in Chicago was a significant reason.
He shared stories about employees being robbed, which added to concerns.
Other companies, like Boeing and Tyson Foods, have also left the city.
However, some real estate agents believe crime isn’t the only issue.
They think Griffin overpaid when he bought his penthouse, and he was unlikely to find someone willing to pay such a high price.
Chicago’s real estate market doesn’t attract the kind of flashy, international buyers seen in places like New York or Miami.
Even with significant price cuts, luxury condos have struggled to sell.
For example, a condo at the Four Seasons Hotel Chicago recently sold for $1.025 million, less than the $1.8 million paid in 2000.
Many units have been sitting unsold for years at a newer building called One Chicago, with some prices dropping by 20%.
But there is some hope. Recently, sales have started to pick up, and more buyers are showing interest.
One agent said prices have fallen enough for people now to see good deals.
While Chicago’s real estate market still faces challenges, it might finally be starting to recover.