LOGAN SQUARE — Hillary Bartoli has a manila folder she calls her “Whipple Sell” folder.
The folder is filled with fliers from realtors, developers and property investors clamoring to buy her early 1900s-era greystone at Whipple and Cortland streets, right off The 606’s Bloomingdale Trail.
Bartoli and her husband are small landlords who are considering selling their building, but not because they want to. The couple can’t afford to keep the rents low after the latest round of property tax hikes. In 2018, their bill nearly doubled.
“It threw us over the edge,” she said. “We began to think we aren’t going to be able to do this anymore.”
Now the couple has a decision to make: Do they hike up the rent on their longtime tenants or do they sell the building they’ve held dear for more two decades?
“I don’t want to sell it. I’m not interested in the money. I’m interested in keeping a piece of property that we sought and put a lot of care into for people to enjoy. It means something to us. It’s not just a little thing to flip,” Bartoli said.
Earlier this month, Block Club reported on invisible evictions in Logan Square and Pilsen, two neighborhoods at the epicenter of the gentrification fight in Chicago.
In both neighborhoods, families are being quietly ripped from their homes as landlords and property investors rehab and flip old buildings for profit.
But small landlords in Logan Square like Bartoli say the narrative around the neighborhood’s invisible eviction problem — that “evil” landlords and developers are forcing out longtime tenants just because they can — isn’t based in reality.
What’s actually happening is the cost of owning land in the gentrifying neighborhood has skyrocketed. As a result, landlords are being forced to pass on those hefty increases to their tenants or sell to the highest bidder, they said.
Aldermen in Logan Square and other neighborhoods across the city are pushing for Chicago to adopt the Just Cause/Good Cause eviction ordinance to give longtime renters more rights. The proposed ordinance, which just got a boost from Mayor Lori Lightfoot, would prevent landlords from evicting tenants without justification with only 30 days’ notice.
About 25 percent of tenants who are evicted in Chicago are evicted without cause, the mayor said.
But small landlords in Logan Square say the proposed ordinance isn’t the fix the city needs because it doesn’t address the root of the problem: A lack of affordable housing.
‘I’m going to have to make that up somewhere’
It’s more expensive to be a landlord in Logan Square today than it was several years ago.
Logan Square saw the highest property tax hike of any neighborhood in the city in 2018. A citywide water and sewer tax hike also went into effect last year.
Josh Gartler, a landlord who rents out his three-unit apartment building in Palmer Square, said he’s feeling the squeeze. When he bought the building in 2000, he was charging $700 in rent for a three-bedroom coach house. Today, he charges $1,900 because the property’s value soared, and he now pays a lot more in taxes.
“I don’t like to increase my rent so abruptly that it forces my current tenants to move out. The increases are typically gradual, over several years. If there’s a big increase in property taxes, I’m going to have to make that up somewhere,” he said.
Unlike Bartoli, Gartler isn’t on the brink of selling. But rising costs may eventually force him to renovate and hike up the rent.
“If it comes to the point where the only way for me to survive as a landlord is to renovate and maximize my investment then I guess that’s what I’m going to have to do,” he said.
Gartler, who runs Poster Plus, a vintage poster business, said the bad reputation landlords have in the neighborhood is “somewhat unfair, but somewhat justified in some cases, too.”
Small, independent landlords are struggling to pay their bills while large management companies are scooping up properties left and right, he noted.
“These large companies — they have deep pockets and they have a formula they follow. They can acquire a building for x number of dollars, renovate it, increase the rents. …They’re going to outbid me every time,” he said.
That happened to Gartler recently. He tried to buy a different Logan Square building recently but got outbid. He suspects an investor with deep pockets scored the property instead.
‘If people can’t eat, is it the responsibility of the grocery store to give them free food?’
Steve Cain has owned a four-flat near Darwin Elementary School since 1990. Cain said he bought the building “when things were tough,” long before Logan Square became a hot neighborhood.
Back then, Cain paid about $800 in property taxes and charged tenants about $600 in rent for a three-bedroom apartment.
“There was crime and there were no restaurants and there was no demand. I went to Logan Square because it was a neighborhood I could afford to go. I thought maybe it’ll get better. I was right. Lucky me,” he said.
Today, Cain pays about $16,000 in property taxes and charges tenants living in the apartments he rehabbed between $1,700 and $1,800 in rent. He said he’s had to raise the rents on his tenants every year to keep up with soaring property taxes and other costs.
Some tenants have left over the years, which Cain attributes to “natural” turnover.
“People change jobs, they get divorced, they get married, they have families. It’s just normal,” he said.
Cain has more experience with real estate than Bartoli and Gartler. He works for a company that does lending on behalf of the United States Department of Housing and Urban Development and he also helps run a small real estate investment company called Greenspire Capital.
He lives a few blocks from his four-flat, his first foray into real estate. The other properties he owns are tied to Greenspire.
Cain said landlords are being unfairly blamed for forced displacements in Logan Square.
“If you’re going to tell me I can’t raise my rent anymore, I’m going to say no, I’m responding to the market. A unit that used to rent for $600 now rents for $1,800. I can only rent for $1,200? OK, you’ve just taken away half the value of my property,” he said.
Cain said those who are fed up with the forced displacements should direct their anger at city officials — not so-called “evil” landlords.
The demand for affordable housing is growing and the city is responsible for building more affordable housing to meet that demand, he said.
Cain said he’s in favor of the 100-percent affordable housing complex coming to the parking lot next to the Logan Square Blue Line station.
“We need more of that in Logan Square,” he said, adding that low-income tenants deserve to live in new buildings with new electric and plumbing, buildings where they won’t have to worry about rent hikes.
Cain said the aldermen pushing for the Just Cause/Good Cause ordinance are off base.
“The solution is always that the landlord pay, that the landlord can’t raise rent, that the landlord can’t evict a tenant. … Always it’s the landlord’s fault,” Cain said.
“If people can’t eat, is it the grocery store’s responsibility to give them free food or to give them reduced cost food? If housing is important to society, then society should pay for housing.”
Chris Pezza, longtime broker and former board member at the Chicago Association of Realtors, said the city needs to be incentivizing developers to build more affordable housing.
“Most landlords I know, if not all landlords I know, do want to solve the affordability problem and do want to help. They’re just looking for ways to make it sustainable and affordable for them,” he said.
“That’s the only way to solve this issue rather than throwing a bunch of ordinances at a wall.”
Some landlords say they don’t have a problem with adding more layers of protection for renters, but they do have a problem with targeting landlords, many of whom are trying to do right by their tenants.
“There’s an understanding, at least from my tenants, that I’m not raising the rent arbitrarily or to maximize the amount of money I make on a property,” Gartler said.
“When I do it, I explain to them: Last time I raised the rent, property taxes went up x dollars, the portion you have to make up is x. What do you think is a fair amount to raise the rent? Most of them have accepted the full amount of what’s fair.”
‘I’m being forced to make a decision I didn’t want to make’
Bartoli and her husband bought their greystone for $260,000 in 1999. The couple had just gotten out of school and were just starting out.
“That was a big chunk of money. We had to borrow from our parents to put the down payment down,” she said.
The couple fixed up the building “just enough to get some tenants” into one of the apartments and moved into the other unit. They went on to live in the building for several years. Bartoli handled all of the maintenance herself.
It wasn’t until 2008 that the building became an investment property for the family when they moved into Bartoli’s mother-in-law’s home in Avondale. The couple had two sons while living on Whipple Street and went on to have two more.
Bartoli, a stay-at-home mom, and her husband, a digital marketer, have kept rents at the Whipple Street greystone relatively stable since 1999. They started out charging around $900 and are now charging $1,200 – for the two three-bedroom apartments.
“We just held steady. We really liked our tenants. They’ve been good to us. We’ll be good to them. It was ideal because we really loved our property,” Bartoli said.
But after the latest property tax hike — a jump from $3,639 to $6,765 in just one year — Bartoli and her husband can no longer afford to keep the rents low. They either have to renovate the building and “slowly” hike up the rent or sell.
If they sell, it will likely go to one of the many developers who has contacted her — those collected in her “Whipple Sell” folder — which is not ideal.
“It’s going to go to someone who has a lot of money. It’s going to change the building,” she said.
“This is a piece of Chicago history. It was built in 1906. It has all of the original woodwork and the built-ins. … I don’t want someone to go in and paint the woodwork or take it all out and make it another box.”
Bartoli said beyond keeping her tenants happy, she also wants to keep the building so her kids can move in someday, but that’s “not going to happen” if costs keep mounting.
“I would hold onto it probably forever, if it weren’t for this,” she said.
“I’m here to give voice to the small potatoes. I know you hear about all of these people driven out, but some of these people are landlords and land owners. I don’t want them to be the bad guy. They’re stuck. I’m being forced to make a decision I didn’t want to make.”
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