• Greektown Loft Office Property Returns to Bankruptcy Chapter 11

    A Greektown building defaulted on its first mortgage of $18.4 million barely one year after emerging from Chapter 11 bankruptcy.

    The venture owned by a husband-and-wife team from Wisconsin has missed mortgage payments on 833 W. Jackson Blvd. since March, according to a complaint filed by Wells Fargo Bank N.A.

    The property has not managed to come back to full occupancy after the collapse of a key tenant, Krahl Construction. Krahl Construction went out of business after it was raided by the FBI in 2010. The building’s vacancy rate is up to 24.5% after being almost fully leased in 2009, according to real estate data provider CoStar Group Inc. and court documents.

    The property is two buildings separated by a parking lot. One is an eight-story structure built in 1910, and a five-story structure built in 1924. Vintage office spaces such as these are struggling to find tenants due to lower quality office space.

    The burden of turning around the property may shift to MCZ Development Corp., who holds a $1.2 million mezzanine loan on the buildings. Michael Lerner of MCZ Development must refinance the first mortgage or face foreclosure by Wells Fargo. A foreclosure by Wells Fargo could potentially wipe out the $1.2 million investment.

    The owners of the venture filed a Chapter 11 bankruptcy petition in an attempt to hold off the foreclosure, one year after emerging from a previous Chapter 11.

    Corporations of all kinds take advantage of the legal resources to save the business from going under. Individuals who face similar circumstances are able to use the exact same resources in order to minimize disruption to their lives. Bankruptcy is an excellent tool for reorganizing personal finances and getting a fresh start.

    Benjamin Brand Services – Chicago bankruptcy lawyer

  • Troubled Block 37 on Market After Foreclosure Fight

    The new Block 37 mall on State Street is officially going up for sale after a long and hard-fought foreclosure battle.

    The bank group that now owns the shopping center has hired Eastdil Secured LLC to market the mall. The 280,000 square-foot mall opened in November 2009, a few weeks after the lender group sued to foreclose on the project. Bank of America leads the lender group.

    Bank of America gained control after bidding $100 million at a sheriff’s foreclosure sale in March. The bid amount is less than half of the loan’s $206 million balance. No other bids were made for the mall.

    The $100 million offer is known as a credit bit. Lenders take back properties in an attempt to satisfy the amount they are owed. These bids can sometimes indicate what lenders think a property is valued at.

    Daniel Hyman, president of Millennium Properties R/E Inc., feels the mall should draw strong interest from investors. “There’s obviously going to be interest,” Mr Hyman says. “There are more people downtown with dogs than briefcases. There are people there that would shop.”

    A spokeswoman for Bank of America confirms the hiring of Eastdil. The brokerage had been hired by the lender group to market the mortgage late in the foreclosure proceedings.

    Benjamin Law Firm – Chicago foreclosure attorney