Essex Hired To Sell The Plymouth, Master Leased By Sonder, Inc.
Chicago-based investment real estate brokerage firm Essex Realty Group, Inc. has been exclusively retained to market for sale The Plymouth, a turn-of-the-century classic building in the heart of Chicago’s Loop. Located at 417 South Dearborn Street, the Plymouth features 30 apartments and multiple common area spaces including a rooftop club room and fitness center.
The Plymouth presents an investor with a unique opportunity as the entire building is master leased by Sonder, Inc. an international hospitality company combining the comfort of a home with the amenities of a hotel. Sonder is the ideal subtenant to reside in The Plymouth as they guarantee 100% occupancy with extremely reduced costs and time that is typically required to manage a property of this size. Sonder has maintained perfect payment history, even through Covid-19, and have confirmed a merger to go public at a $2.2bn valuation.
“We are seeing more and more multi-family properties occupied by hospitality companies as developers execute master or bulk leases with hotel operators such as Sonder, Inc.,” says listing broker and Essex Realty Group Principal Jordan Gottlieb. “This property underwent an incredible transformation and was originally intended for a 130-bed student housing property. However, Sonder, Inc.’s master lease offer provided the owner with a very attractive tenant and a stable income stream.”
Gottlieb explains this property, though operating as a hotel, lives like a full-amenity apartment building with full kitchens, in-unit laundry, and a club room and gym, which enables hotel operators to rent units at a premium daily rate. Owning hotel units that are built with high-end apartment finishes offers great flexibility to a landlord. Should the building convert back to apartments or student housing, the owner has very limited capital expenditures required to make that switch.
The Plymouth is listed for sale at $17,500,000.
Sonder, the current tenant, offers guests fully furnished, short-term apartment rentals and guests are encouraged to stay anywhere from two nights up to two years. Sonder began operations in Chicago in 2015 and operates in popular neighborhoods including Lincoln Park, Lakeview, Wicker Park, Bucktown, the West Loop, Old Town, the Loop and the South Loop. Notable investors of Sonder include Jeff Bezos, Elon Musk & Alex Rodriguez.
Since 1990, Essex Realty Group, Inc. has served Chicago’s investment real estate market as a top multifamily brokerage firm. Contact us today to learn more about our recent multifamily and mixed-use property sales, or click HERE.