A number of new downtown apartment buildings have recently lowered their rents while simultaneously discontinuing free rent offers.
Almost all of the free rent offers required payment of the full stated rent and no payment in select months. New renters were not allowed to amortize the free months over the term of the lease and pay the reduced rent. One of the reasons for that policy was to ensure that renters didn’t experience “sticker shock” at renewal time.
At most of the buildings that have reduced rents, the new rents are nearly identical to amortizing the free rent incentives over the lease term. Where that’s the case, the “free rent” offers have been locked into the rent structure for a while.
As new buildings offer incentives to lure renters this year, it will be interesting to see whether free rent offers return in the buildings that discontinued them in favor of rent reductions.
You can see all of the new downtown apartment buildings that have recently opened, are underway or proposed on YoChicago’s at-a-glance list