Back of the Yards Gets Housing Boost
A community-driven affordable housing project in Chicago's Back of the Yards neighborhood has just marked a key milestone. The development is focused on creating homeownership opportunities for local families, signaling continued investment and potential for revitalization in the South Side neighborhood.
The Back of the Yards housing initiative is led by The Resurrection Project (TRP), a community developer with a 35-year history of creating affordable homes and pathways to wealth. TRP has a track record in the neighborhood, previously redeveloping 40 foreclosed and vacant properties with a $13.8 million grant from HUD's Neighborhood Stabilization Program. That earlier project included renovating 15 buildings into for-sale homes, such as 11 two-flats and four single-family houses. This new development adds to a growing portfolio of community-focused projects, including the nearby "United Yards" a $65 million collaboration that is redeveloping three city blocks with affordable housing and new commercial spaces like a health center, bakery, and coffee shop. Such projects are part of broader revitalization efforts in a neighborhood that faced significant disinvestment after the Union Stockyards, its primary economic engine, closed in 1971. For investors, the Back of the Yards market shows a median sale price of around $220,000, with a notable 28.7% year-over-year increase in the median sale price per square foot. The neighborhood's housing stock is largely historic, with 63.8% of residences built before 1939, offering potential for renovation projects. These single-family and two-flat homes present a stark contrast to the luxury-dominated new construction seen in other parts of the city. Across the Chicago multifamily market, cap rates averaged 6.7% in Q3 2025, higher than the national average, presenting attractive yield opportunities. The market is experiencing robust rent growth, forecasted at 5.3% for 2025, driven by a significant slowdown in new construction and steady demand. With only 1.9% of total inventory under construction—the lowest level since 2012—the limited new supply further supports rising rents and property values. The Midwest region is increasingly drawing investor attention for its affordability and stable returns, outperforming coastal markets in rent growth since late 2022. In the first quarter of 2024, the Midwest had the highest average cap rate of any U.S. region at 6.0%. This trend, coupled with a median existing home sales price of approximately $280,000 in Q1 2025, positions markets like Chicago for continued investment. For those transitioning into real estate investment, firms typically seek candidates with a bachelor's degree in finance or a related field and 1-2 years of experience. Key technical skills include financial modeling in Excel and Argus, data analysis, and market research. Aspiring analysts can find stories of local investors who built portfolios while working full-time, often leveraging creative financing like HELOCs and 401k loans to acquire their first properties. To break in, networking through organizations like the Urban Land Institute (ULI) is critical. Informational interviews and gaining a deep understanding of local economic drivers and neighborhood dynamics are essential for credibility. Following local real estate news and investor-focused podcasts like "Straight Up Chicago Investor" can provide valuable market commentary and insights into deal sourcing and scaling.
