Darren Sloniger has had tougher opponents than a Chicago alderman.
Sure, he had money on the line and a powerful pol against him when he sought to expand a neighborhood he was creating on the western edge of Fulton Market by another 500 apartments when he got stopped cold by 27th Ward Alderman Walter Burnett. But that was nothing compared to the risks that came with fighting apartheid, a cause the son of a pastor joined in South Africa decades before his real estate career blossomed.
And the persistence Sloniger learned in South Africa in his 20s proved useful in Chicago in 2020, when Burnett shot down his initial plan to develop Parq Fulton. He envisioned a 26-story, 278-unit building at 1400 West Randolph Street that needed a zoning change to proceed.
“He’s a good friend of mine, but he opposed my project,” Sloniger said of the longtime city council member.
Sloniger wanted to put affordable housing units in a separate building in the neighborhood in lieu of Parq Fulton. It would be no small feat either way — Sloniger’s bids to bring dense multifamily housing west of Ogden Avenue was pioneering at the time, drafting off the redevelopment of Fulton Market. He had to designate 20 percent of his units as affordable, double the 10 percent requirement in place at the time for properties already zoned for multifamily development.
A foray south along Ogden into the Illinois Medical District became his path to a deal that trimmed the requirement for affordable units at Parq Fulton in about half. Sloniger agreed to reface and renovate what he called the “ugliest building in Chicago,” an 18-story property at 1922 West Ogden, which he bought for $28 million in 2019 and upgraded and reopened as 272 apartments, with 53 units reserved for renters making 60 percent of the area median income.
Another project accounted for more, and Sloniger eventually got Parq Fulton clear to split a requirement for 53 units available at rates deemed affordable for residents with incomes at 100 percent of the area median. About half of the obligation would be met at a nearby project called Evo Union Park.
“I didn’t know this at the time, but 10 other developers were chasing this,” Sloniger said of the Parq Fulton site.
He acquired the property from the Cornerstone Restaurant Group, which used to have a restaurant there called One SixtyBlue, and counts Michael Jordan among its investors. The company maintains a minority stake in the apartments project.
The machinations and ultimate success of satisfying the city’s requirements on affordable housing, while adding three projects to the Naperville-based multifamily real estate developer and landlord Marquette Cos.’ portfolio, helps explain Sloniger’s most recent move. Earlier this month he became CEO of the company, succeeding Nick Ryan, who moved into the role of chairman.
Sloniger takes the top day-to-day job after serving as Marquette’s chief investment officer, spearheading the development of those West Loop apartments in the darkest days of the pandemic in 2020, when he said he “raised $30 million from my bedroom” to move the projects forward. He sat down on the top story of Parq Fulton to discuss his new responsibilities, and his outlook on Chicago’s commercial real estate market.
This interview has been edited for length and clarity.
Much of the commercial real estate industry has expressed a desire for the next mayor’s administration to address a perception of crime and help find a solution to uncertainty over property tax costs. What do you think the industry wants out of the next administration?
We want Rahm Emanuel back.
What was great about him?
He’s just a business guy, just a stable dude who was rational and was for the city and making sound business decisions. And truly, (Mayor Lori) Lightfoot does too, except she’s her own worst enemy. She doesn’t understand she’s a politician. When she gets pissed off, she’s going against you, she will take you out. She doesn’t care if you’re the owner of Citadel or the CEO of McDonald’s, which everyone else cares about because we want them to stay in Chicago.
A lot of people talk about the shrinking of Illinois’ and Chicago’s populations, but the Chicago Metropolitan Statistical Area has actually grown every decade for the past 100 years, even as the city proper has gone through a decline within that time frame. How have recent population trends impacted Chicago, and are they a threat to its future as a market?
What’s happened is we’ve gained in the core. I recently read something that educated me on the situation of the decrease of the population of Chicago. When they blew up all the public housing, like Cabrini Green and the Robert Taylor homes, their residents all got displaced. The city of Chicago gave them a system for getting back into the system that didn’t work, that they were all displaced.
It’s a generational issue. But I’ll be really interested to see how all my peers are going to meet the new requirements for 20 percent of units in all cases to be designated as affordable. It appears they are doing 100 percent of those units on site. I’ll be very interested to see how that plays out, how they are getting deals financed, how that impacts the property.
How does your job change at Marquette?
It’s going to be a big shift. Every little nook and cranny of this building, I approved that. The hours spent on the conversation of this pebble flooring is immense. To move from the minutiae of development, where all the forces of evil are against you and trying to stop your development, to now have people I’ve been training for the last few years to take over the development side for me and now just work on organization is going to be a big deal. I’m a deal guy, so I love doing the deals, negotiating the land, negotiating the zoning. So now, to go from a deal guy to cultural-organizational guru is a whole different level. But I love it. I’ve been sticking my toe in the water the last couple of weeks, and it’s been awesome spending more time with my managing director, empowering employees and giving them the tools they need to be successful.