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Author: Mark Ainely | Partner GC Realty & Development & Co-Host Straight Up Chicago Investor Podcast

There are two things that show up over and over again in Chicago real estate: the people who keep showing up eventually win, and the neighborhoods that look “boring” today often become the ones everyone wishes they had bought in five years ago.

https://youtu.be/c76qFdf02mI

That’s a big part of this episode with John Preston from Horvath & Tremblay.

John has been grinding in Chicago apartment brokerage since 2019, mostly focused on the North Side and Northwest Side. He has built his business the hard way: cold calls, meetings, broker opinions of value, follow-ups, failed listings, dead deals, and the kind of consistency that most people talk about but few actually do.

We cover what it really takes to build a brokerage business, how buyer and seller expectations have shifted since COVID, why rent growth has helped bring velocity back into the market, and where John is seeing opportunity today in places like Portage Park, Jefferson Park, Rogers Park, West Ridge, Evanston, and the Peterson/Ridge corridor.

If you are a Chicago investor trying to buy your first 5-unit, 6-unit, or small apartment building on the North Side, this episode gives you a practical look at how brokers think, how deals move, and how to be taken seriously as a buyer.

Questions We Answer in This Episode

Q: What’s the housing provider tip of the week?
A: If you own older Chicago housing stock, especially buildings built before 1960, make sure you know whether your property has a catch basin. Many owners don’t realize they have one, let alone that it needs a maintenance plan. Catch basins help stop grease and debris before it hits the city sewer system, but if they’re not cleaned out regularly, you can end up with backups or bigger plumbing problems. Older brick catch basins can also deteriorate or collapse, so they need to be inspected and maintained.

Q: How did John Preston get into Chicago real estate?
A: John grew up in Indianapolis with a mom who was a realtor, so he was exposed to real estate early. After graduating from Indiana University with a finance degree in 2019, he realized he didn’t want a traditional finance or accounting path. A short sales job in Southern California ended quickly when the company dissolved, so he moved to Chicago and started with Horvath & Tremblay later that year.

Q: Did John understand what he was getting into when he started in investment sales?
A: Not really. He knew investment sales sounded interesting and liked that it was a 100% commission job where income was tied to effort. But once he started, he realized how long it takes to build a sustainable brokerage business and how much rejection comes with the job.

Q: What does the first six months look like for a new investment sales broker?
A: Training, database work, and a lot of cold calls. John explains that a new broker has to learn how real estate transactions work, understand their market, build a clean database, identify owners, and then start making calls. The early goal isn’t always to win a listing. The first goal is often just to get a meeting.

Q: How many calls does John still make today?
A: Even now, he still makes around 150 to 200 cold calls a week. He explains that calling is still a major part of the business, but the key is not just calling blindly. The best calls are tied to something relevant: a nearby sale, a similar building, current rent data, or a real reason the owner should care.

Q: What market does John focus on?
A: John mainly focuses on small and mid-sized apartment buildings on the North and Northwest Side, especially 5 to 30-unit buildings. He also does plenty of 2 to 4-unit buildings, but those often require more of a traditional realtor approach because they involve more showings, weekends, and buyer variety.

Q: How have seller conversations changed since COVID?
A: Early COVID created fear and uncertainty. Owners were worried about rent collection, tenant jobs, and whether they should meet anyone in person. Then rates moved up, and a lot of sellers wanted to wait for rates to come back down. Today, John says people seem more accepting of the current environment. Buyers and sellers are starting to meet each other again because rents have grown and more of the unknowns, like taxes and rates, have become clearer.

Q: Why is deal velocity better now than it was a year or two ago?
A: A lot of it comes down to buyer and seller expectations finally getting closer. When rates jumped, sellers still remembered old pricing while buyers were underwriting with new debt costs. That gap made deals hard. Now, rent growth has helped support pricing, buyers have adjusted to the rate environment, and some sellers are seeing that the numbers finally make sense again.

Q: What was John’s first deal?
A: His first deal was a 25-unit apartment building in Rogers Park off Sheridan Road. It took him about 18 months from starting in brokerage to closing his first deal. He listed it, showed it around 40 times, didn’t sell it during the original listing period, kept working it, almost lost the buyer, and then finally got it closed after the buyer’s banker convinced him not to pass up the low-rate environment.

Q: What would John do differently on that first deal today?
A: He would present the asset more clearly. At the time, he was reluctant to say anything negative about the property and described the units too positively. Now, he understands that buyers need a clear picture. If units are vintage, say that. If they are clean but dated, say that. Over-selling the condition wastes everyone’s time.

Q: What do people misunderstand about brokers?
A: A lot of people only see the closing and the commission. They don’t see the hundreds of calls, the meetings that go nowhere, the BOVs that don’t turn into listings, the listings that don’t sell, and the deals that die. John walks through the numbers: roughly 250 calls a week can lead to five meetings, which might lead to four BOVs, which might lead to one listing. That’s before showings, negotiations, diligence, and closing.

Q: What is a BOV?
A: A BOV is a broker opinion of value. It’s basically the broker’s valuation and go-to-market proposal for an owner. It explains what the property may be worth, what comps support that value, where offers may come in, and how the broker would sell the building.

Q: How should buyers work with brokers if they want to buy small multifamily in Chicago?
A: Be specific. Don’t just say, “Send me everything.” John says brokers have stabilized deals, value-add deals, city deals, suburb deals, 2-flats, 30-unit buildings, and off-market opportunities. If a buyer can explain their target area, unit count, budget, condition preference, and return expectations, the broker can actually help.

Q: What is one thing unserious buyers say?
A: Something like, “Do you have any 10 caps on the North Side?” Everybody wants a great deal, but buyers need to be realistic about what actually exists in the market. A mixed-use building at a 7.25 cap in a strong North Side neighborhood might be the yield opportunity, not a 10 cap apartment building that doesn’t exist.

Q: What does John like about Portage Park and Jefferson Park?
A: He likes the renter demand, quieter streets, transportation access, and value-add opportunities. He gives examples of vintage 2-bedroom units rented around $1,100 that were later pushed to around $1,550 without major work. He also points out that updated units in these areas can push much higher, and new construction has already proven that renters will pay for quality.

Q: What pricing is John seeing in Portage Park and Jefferson Park small multifamily?
A: He mentions several deals trading around $150,000 to $160,000 per unit, often a little over 10 times gross income depending on condition, rent levels, and unit mix.

Q: What does “10 times gross” mean?
A: If a building has $100,000 in gross income and sells for $1,000,000, that’s 10 times gross. It’s a quick way investors compare pricing, though it should not be the only metric. If rents are far below market, current GRM may not tell the full story.

Q: What happened with the Farragut deal?
A: John had tried to sell the Farragut building earlier and couldn’t get buyers above $900,000. Two years later, after rent growth and more market momentum, he listed it at $950,000 and activity was strong. It ended up selling above list price. That example shows how quickly a neighborhood and deal can catch up when rents move.

Q: How does Rogers Park compare to other North Side neighborhoods?
A: Rogers Park has different pockets. East Rogers Park near Sheridan can have a lot of studios and 1-bedrooms. West Rogers Park feels more residential and suburban in some places. The Loyola area has a different renter base with more student influence. Investors need to understand which part of Rogers Park they are buying in because the tenant profile and pricing can change block by block.

Q: How is Evanston different from Rogers Park?
A: Evanston, especially near Northwestern, has a student housing component where investors often think in price per bedroom instead of just rent per unit. John mentions high-end student housing getting around $1,500+ per bedroom when fully renovated and furnished, while less updated properties may be closer to $950 per bedroom. The range depends heavily on condition and exact location.

Q: What should Chicago investors know before buying in Evanston?
A: Evanston does not have the same type of point-of-sale inspection as some suburbs, but owners still need to understand rental registration and local rental rules. From a management standpoint, Evanston also has its own quirks, including security deposit and move-in fee considerations, so don’t assume it operates exactly like Chicago.

Q: What neighborhood does John think investors may regret missing?
A: West Ridge, especially around the new Peterson/Ridge Metra station. He talks about a 6-unit building with large 2-bed, 2-bath units that sold around $860,000 and was grossing about $80,000. After some renovations and rent adjustments, the buyer pushed gross income closer to $130,000 in about six months. John sees big units, quieter streets, transit improvements, and a lot of upside.

Q: Why is John bullish on the Northwest Side overall?
A: Good renters, transportation, larger units, value-add opportunities, and strong demand for nicer product. He says some 2-bedroom units still renting around $1,200 can potentially move toward $1,600 to $1,700 without major work, while fully improved units can push north of $2,000 depending on location and quality.

Q: What’s John’s outlook on Chicago overall?
A: He’s very pro-Chicago. He sees the city as slow and steady, with rent growth now catching more attention. Beyond real estate metrics, he likes the lifestyle, the lakefront, the energy of the city, and the long-term fundamentals.

Q: What is John’s competitive advantage?
A: Work ethic and the ability to handle failure. Brokerage includes rejection, lost listings, deals falling apart, and constant setbacks. John says he has developed a “calloused brain” that lets him keep moving, learn from losses, and find the next opportunity.

Q: What advice does John give to someone who has not bought their first Chicago property yet?
A: Start talking to brokers and other people in the industry. Underwrite deals, tour properties, figure out what you do and don’t like, and put yourself out there. There probably won’t be a perfect deal, so you need reps before you can make a smart move.

Show Notes

00:00 John Preston opens the episode
00:17 Back-to-back recording days and a young listener finding the podcast at the gym
01:08 Networking, a Northwestern soccer player getting involved, and the Rogers Park Builders summer event
02:36 Housing provider tip: catch basins in older Chicago buildings
04:01 John Preston from Horvath & Tremblay joins the podcast
04:35 Growing up in Indianapolis, real estate exposure through his mom, and moving to Chicago
05:45 Horvath & Tremblay’s background and office expansion
06:24 Why investment sales sounded attractive and what John didn’t understand at first
07:20 The first six months: training, databases, cold calls, and getting meetings
09:00 Choosing a market and asset class
10:02 Why John focuses mostly on 5 to 30-unit buildings
11:38 How landlord conversations changed from COVID to today
14:00 Market velocity, rent growth, and buyer/seller expectations finally aligning
16:19 John’s first deal: 25 units in Rogers Park after 18 months of grinding
20:41 What John would do differently on that first listing today
22:36 What people misunderstand about brokerage work
23:08 The math behind 250 calls, meetings, BOVs, and listings
24:41 How long it takes to make 250 calls and why call prep matters
26:04 Why consistency matters more than any single call
30:03 Follow-up systems, Salesforce, and talking to your future self in call notes
31:42 How buyers should work with brokers and narrow their buy box
34:13 Unrealistic buyer expectations and the “10 cap on the North Side” problem
35:13 Portage Park and Jefferson Park: renter demand, pricing, and upside
37:35 What 10 times gross means and how investors use GRM
39:09 Farragut deal story and how the market changed over two years
40:52 Rogers Park pockets: east, west, Loyola, and different renter profiles
42:21 Evanston student housing and price-per-bedroom underwriting
44:13 Evanston rental registration and local management considerations
45:43 West Ridge and the Peterson/Ridge Metra station opportunity
48:07 Why John is bullish on the Northwest Side
49:34 New construction, affordability, and why building more matters
51:08 John’s outlook on Chicago
52:09 Competitive advantage: work ethic and handling failure
53:12 Advice for first-time Chicago buyers
54:04 Golf, beach volleyball, and enjoying the city
54:35 Recommended activity: morning workouts to protect the mental side of brokerage
55:29 Valuable Chicago resources: neighborhood groups, Rogers Park Builders, and networking events
56:17 How to reach John Preston
56:49 Chicago fact: the Phoebe and John Gray House in Irving Park
59:00 Final reminder: get out and network

Takeaways for Chicago Property Managers and Landlords

If you own older Chicago housing stock, know whether you have a catch basin and maintain it before it becomes a sewer backup.
Brokerage is a reps business. The deal you see at closing may have hundreds of calls and years of follow-up behind it.
Buyers who are specific get better deal flow. “Send me everything” is not a strategy.
North and Northwest Side neighborhoods are still showing value-add upside because rents have moved faster than some owners realize.
Portage Park, Jefferson Park, West Ridge, Rogers Park, and Evanston all have opportunity, but each has a different renter profile and underwriting lens.
West Ridge near the Peterson/Ridge Metra station is one of the areas John thinks investors may look back on and wish they bought more of.
The gap between vintage and updated rents has widened, which creates more opportunity for operators who know how to renovate properly.
Chicago’s market may not always move like the boomtown cities, but the slow and steady fundamentals are exactly why long-term investors keep showing up.

Guest Name: John Preston

Guest Company: Horvath & Tremblay
Guest Link: https://horvathtremblay.com/

Because finding good tenants and property management shouldn’t feel like online dating.

Dear Investor,

If you are an investor in either the city or suburbs of Chicago, I would love to speak with you about how we can help you on your real estate journey. At GC Realty & Development LLC, we help hundreds of Chicagoland real estate owners and brokers each year manage their assets with both full service property management and tenant placement services.

We understand that every investor’s goals are unique, and we love learning about each client’s individual needs. If there is an opportunity to help you buy back your time by managing your rental property or finding quality tenants, please check us out.

Best Investing,