AIG Lends $57M on New Geothermal Mixed-Use Project in Chicago

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DLG Management has nabbed a $57 million loan to refinance a newly constructed, geothermal mixed-use property in Chicago, Commercial Observer has learned.

AIG provided the 15-year loan, which features a 3 percent interest rate, on behalf of DLG’s Dave Gassman for The Residences at the Eagle Building, sources familiar with the deal told CO. The financing arrangement was negotiated by Meridian Capital Group Managing Director Gershon Friedman out of the company’s Chicago office. 

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Located at 3833 N Broadway, the property is touted as the first geothermal, privately owned building of its kind in the Midwest. The 134 apartments feature R-30 insulated walls, insulated and gas-filled windows, as well as electric and Energy Star-certified appliances. The building, which was completed in 2019, also consists of 20,000 square feet of commercial space currently leased to Starbucks and Smylie Brothers Brewing Co.

“Dave Gassman’s idea to develop a geothermal mixed-use property is ingenious, not only is the building environmentally friendly, but it also allows him to mitigate risk and enhance bottom line performance by regulating utility expenses, which are a fraction of what they would be otherwise,” Friedman said in a statement. “Despite the fact that the property was in the middle of the lease-up process, Meridian was able to successfully negotiate favorable permanent financing based on the top-tier quality of both sponsorship and the asset.”

Officials for AIG and DLG did not immediately respond to requests for comment.