A year after acquiring the properties previously owned by K&G Management, Hyde Park’s largest realtor, MAC Property Management, has begun a phased increase of unit rental fees.
The increases, which are as high as 15 percent for some properties, affect a number of units across Hyde Park, though the majority will not face any changes—yet.
“We are not raising every MAC unit this year,” said Peter Cassel, the MAC director of community development. He noted, however, that “over the course of the next few years, the rent of all units will be increased,” except for select units where the rent is tied to residents’ incomes based on agreements made with local affordable-housing groups and local government.
These changes stem from a combination of factors, Cassel said, including higher demand for property, improvements made to Hyde Park buildings, and unusually low rent.
“We saw many of the owners of the apartments [previously controlled by K&G] paying more than 25 percent under market,” he said. “When we acquired buildings, we brought them closer to market price. In those cases when there was a significant difference between the market price and what they were paying, we did not raise anyone’s rent more than 15 percent.”
“For K&G’s units, their year started in April, or their year started in August,” Cassel said. “So when we purchased those units, all of them had one of those expiration dates. This is really our first opportunity to look at the rent and, when appropriate, make changes.”
MAC’s changes encompass more than rent increases. MAC, which presently manages more than 300 apartments in approximately 70 buildings throughout Hyde Park, is continuing to acquire new properties, including a building on South University Avenue that sits opposite Henry Crown Field House.
Additionally, unlike other former Hyde Park property owners, MAC has its own on-call maintenance department, through which residents can file work orders. While recognizing that maintenance service has been subpar in the past, Cassel said that, “[Now] almost all our work orders are satisfied within a day. That level of service has some cost to it.”
“I’d be able to meet [the raised rent] because you have to, really,” said Cheryl Luce, a third-year student and MAC tenant. “There’s really no choice.”
“It’s just further gentrification,” said Hilary Dick, a postdoctoral fellow at the University who also rents from MAC. “It’s going to force poor people out of the neighborhood even more. There should not be less affordable housing.”
MAC contends that the overall costs of units are, for the most part, not actually on the rise.
“For example, we put in more efficient windows which helped control heating costs. While the rent may be going up, the total cost of the apartment is not,” he added.
Some residents, however, dispute the motivations behind these repairs, suspecting that they’re done to justify raising rents.
“That’s the thing I hate worst about MAC…they mask themselves as an honest, legitimate business, and then they do things like this,” Luce said.
“We recognize that rent increases are difficult for everyone,” Cassel said. “It’s much the same as we see gas prices going up, food prices going up. We see local taxes going up. All of these things impact us. We would like to be in a world where there weren’t rising costs, but that is not the case,” he said.
In the downtown Chicago apartment market, average rental costs have risen more than 10 percent in the last year, following a 13-percent increase in 2006 and prompting Crain’s Chicago Business to label this “a good time to be a landlord.” With no new units built in Hyde Park in the last decade except for the University’s graduate-student housing, demand for units near campus has remained steadily forceful.
Cassel encouraged residents to attend the upcoming public forum at the Hyde Park Neighborhood Club, at which MAC president Eli Unger will discuss the business and respond to questions and concerns. More information on the May 6 forum can be found at hydepark.org.