Interview with Vikas Wadhwa, Founder of Modern Chicago Homes, about the Chicago Real Estate Market

Industry - Interview

by Meryem Aksoy

Even if we are looking for a new home for investment or living in a city we've lived in for years, we can't be fully aware of current developments or new trends in the real estate market. However, there are sector professionals who follow real estate markets very closely and observe real estate in different areas every day. Real estate agents, who are professionals of this sector, recommend the properties that are suitable for our wishes and purposes. Vikas Wadhwa is also closely following the Chicago real estate market since 2006 when he founded Modern Chicago Homes. His experience in investment banking also gives him a different perspective on real estate investments. I talked to Vikas Wadhwa about his career, Modern Chicago Homes, and the Chicago real estate market.

Vikas, before talking about the Chicago real estate market, could you tell us about yourself? Who is Vikas Wadhwa?

Thank you for asking. I was born in New Delhi, India and moved to the United State in the late 1980s. I did my schooling in the city of Houston, Texas before pursuing my college education at Northwestern University in Evanston, Illinois located just outside of Chicago. That was what first brought me to the amazing city of Chicago which I have now called home for almost 20 years. I currently live in the Lincoln Park neighborhood of Chicago where I enjoy running through the park and along the lake, exploring the boutique stores and great restaurants that the neighborhood has to offer.

Could you tell us about your educational background and your professional career?

I did my undergraduate studies at Northwestern University and graduated with a degree in Economics. After completing college, I worked as an investment banker at Lehman Brothers and Goldman Sachs. After Goldman Sachs, I spent time as an analyst at a small middle-market private equity firm in Chicago - Prairie Capital.

Modern Chicago Homes

After a career in the financial side of investments, what inspired you to pursue a career in the real estate industry?

During my time in the finance world, I had started reading and learning about modern architecture and interior design. I would often read all of the blogs and magazines coming to market during the early 2000s - one of the more notable influences on me was Dwell Magazine. I had purchased 2 properties during my time in the finance fields and renovated one that appealed to my modern design aesthetic. After successfully renovating the property, I decided that there were other modern design enthusiasts like myself in Chicago, and I could utilize my knowledge of the modern real estate market in Chicago in advising other people who shared similar interests in design and architecture as me.

How did you decide to establish Modern Chicago Homes? What inspired you?

I was inspired to establish Modern Chicago Homes due to a lack of knowledgable real estate agents in the Chicago market with that specific expertise and knowledge. I had taught myself a lot about the architecture, builders and built a network of resources over 5 years before starting Modern Chicago Homes. I had always wanted to work for myself and was lucky to find a field and opportunity that I was passionate about.

Modern Chicago Homes

Could you tell us about Modern Chicago Homes and your team?

Modern Chicago Homes is a boutique specialty real estate platform I formed to help buyers and sellers of modern and unique homes throughout the Chicagoland area. Our expert knowledge of modern projects around the city allows us to give our clients the best advice and representation when dealing with modern properties. With our network of industry contacts, we can often find properties for clients before they become generally available to the public. For sellers, our targeted marketing such as our website and social media accounts makes sure that their property is being seen by a targeted audience.

What kind of services do you offer to local and international investors?

For local and international investors, we can help them purchase properties in all parts of the city and at a wide range of price points. While most of the modern properties tend to be focused around the Downtown business district, we can even work with investors who may be looking outside of the city.

Modern Chicago Homes

What type of properties do you prefer most to keep in your portfolio? What are their common features?

The properties that we typically market are ones that have a modern design and unique architecture. We market properties throughout Chicago and the suburbs. The price of our typical properties can range from $300,000 - $2 million (or more).

What are the most important features that affect buyers' decisions in Chicago?

For buyers of real estate in the Chicago market, people are generally looking for properties that have good proximity to transportation for commuting to work. Additionally, finding functional floor plans and good natural light are also key features that buyers look for. Chicago has many neighborhoods so buyers have a lot of choice in where they can live - whether it’s the high-rises in the heart of Downtown or in the nearby surrounding areas that have smaller buildings and tree-lined streets - there’s something for everyone in Chicago.

Modern Chicago Homes

What can you tell us about the current status of the Chicago real estate market? What has been changed over the last 10 years?

The biggest changes over the last 10 years following the Great Recession have been that the new supply that has been coming to market has largely been luxury rental buildings. As rents have increased, developers have been building more rental residences instead of condominiums for purchasing. However, more recently we have seen new projects that are being offered for sale as well - these have been focused in the core neighborhoods around Downtown such as River North, Lincoln Park, West Loop, and the Gold Coast.

Where is the best location for real estate investment in Chicago?

Chicago has generally been a stable market, so investors can focus on the Downtown areas that are usually easy to rent out properties. There has been a lot of growth in the West Loop and Fulton Market areas over the last few years as more companies have announced plans to move their offices to the area - that should continue to provide strong demand in the short term. Another area for good long term investment is the Pilsen neighborhood that is rapidly changing and will continue to develop over the next 10 years.

What do you think about the future of real estate investment?

Real estate offers a stable asset class when compared to a lot of volatility we have been seeing in the other asset classes such as stocks. As urban populations continue to grow, real estate should perform well as an investment and should be part of a diversified investment portfolio.

Modern Chicago Homes

What should the real estate investors pay attention to?

Real estate investors should pay attention to any rental restrictions buildings may have before purchasing a property. Many buildings have put in caps on how many units in a property can be rented. Also, many buildings have banned short term rentals. They should also pay attention to HOA fees and property taxes as those can impact returns.

What is next for you?

Over the next 5 years, I would like to get into developing properties in addition to providing marketing services. I hope to also grow our team and add a few team members who appreciate modern design and architecture as much as I do.

Anything you’d like to add that I haven’t asked?

Many international investors often think of the coastal cities in the United States when considering investing in real estate. However, Chicago is a world-class city and offers attractive prices for those looking for better value. Investors should start putting Chicago on their radars as the city continues to grow and develop its diverse economic base.

Thank you Vikas for your time.

For more information, please click here to visit the website of Modern Chicago Homes

Tuesday, March 5, 2019.

All photos are the property of their respective owners.