Two development sites surrounding the River City residential building along the Chicago River are for sale, both coming out of extended legal battles.
Chicago-based Millennium Properties R/E Inc. was appointed by a Bankruptcy Court judge to broker the sale of a 1.8-acre site just south of Bertrand Goldberg-designed River City, 800 S. Wells St., between Wells and the river in the South Loop. The property is owned by embattled condominium developer Nicholas Gouletas but has been tied up in Bankruptcy Court since August 2013 in the aftermath of Mr. Gouletas’ failed attempt to acquire an almost 3,900-unit apartment portfolio for $950 million.
The parcel, now used as a parking lot, has zoning in place to develop 282 residential units, said Daniel Hyman, president of Millennium Properties. The land between River City and the Roosevelt Collection mixed-use development to the south is worth $10 million, Mr. Hyman said. An investor familiar with the property estimated it to be worth closer to $7.8 million, or $100 per square foot.
“There’s a tremendous amount of development going on right now in the South Loop,” Mr. Hyman said. “It’s a good site along the river. I think everything that’s been happening with Roosevelt Collection and the other developments in the area shows the strength of the core of the city.”
STEP TO RESOLVE CASE
The sale of the Wells Street parcel is a step to resolve the seventh and final venture of Mr. Gouletas that has been in Bankruptcy Court since 2013.
He filed for bankruptcy protection after American Invsco Corp., of which he is chairman and CEO, failed in a bid to acquire a nearly 3,900-apartment portfolio from a venture led by Starwood Capital Group. The $950 million deal fell apart when Mr. Gouletas was not able to arrange financing, after which creditors began trying to collect on loans that would have financed the acquisition.
In June, a bankruptcy judge dismissed the six other cases after American Invsco ventures ceded control of several properties, including the Garvey Food Court downtown.
The sale of the Wells Street parcel will be used to pay off creditors. Any proceeds remaining after all disputed claims are resolved would go to Mr. Gouletas, said lawyer Harley Goldstein, who, along with fellow Goldstein & McClintock LLP partner Harold Israel, represents the venture controlled by Mr. Gouletas.
Mr. Gouletas did not return a call.
ANOTHER SITE ON THE MARKET
Along the east side of River City, a 0.8-acre parcel, also currently a parking lot, was listed for sale less than a month ago by Seattle-based brokerage Colliers International.
That site, at 817-907 S. Wells St., has an asking price of $6.2 million, or $175 per square foot, according to a Colliers flier.
It is listed for sale after a settlement was made with Rosemont-based Wintrust Financial Corp., which took over the loan when it acquired Wheatland Bank of Naperville in 2010, borrower Don Glisovich said. Mr. Glisovich, a Chicago real estate investor, bought the site for $5.2 million in 2005 and in 2008 borrowed nearly $10.8 million from Wheatland, according to Cook County records. Wheatland failed in 2010.
Wintrust CEO Edward Wehmer declined to comment.
(Source: Crain’s Chicago Business)