On the Northwest Side of Chicago, in the affluent neighborhood of Sauganash, an untimely foreclosure last July has left a number of residents holding the bag on significant incomplete or shoddily-finished items.
The Sauganash Place Condo Association President, Bathsheba Birman, complains of a design flaw on the building's green roof which contributes to major flooding on her balcony below during even moderate rain storms. Her hardwood floors show gaps and creek, many of her windows do not open properly. In fact, over half of the building's 61 unit owners have complained of similar problems. Units sold between early-2006 and this year, with price ranges between $350,000 and $550,000.
In addition, improper electrical wiring and gas line installation have co-mingled utilities between the residential common areas and commercial tenant Whole Foods Market, at 40,000 square foot supermarket on the first floor of the building. Plans for a second phase of a 75-unit residential tower, just to the north of the first tower, have been postponed indefinitely, as you may well imagine.
Calls to the project developer, Brook-Ridge Development of Chicago, have been unanswered for months, and the association has had to fund needed repairs with special assessments.
Complicating the matter even further - the developer was "carefully selected" by the City of Chicago to build this project in a Tax Increment Funding (TIF) District, and would have been eligible for $10 Million in special Chicago funding at project completion. According to Chicago Alderman Margaret Laurino, whose 39th Ward contains the Sauganash Place Project, and who was been helping in negotiations with Project Primary Lender, Lakeside Bank of Chicagoto expedite needed repairs, says that none of the TIF money has gone to the delinquent developer, since the building has not been acceptably completed.
Individual units, and, subsequently, the condo association, were turned over despite these defects, which, at the times of closing and association turnover, were deemed to be minor punch list items. When further latent defects were found, the foreclosure process against Brook-Ridge Development had already begun.
As a condo investor myself, I have fallen victim to shoddy workmanship and liquidated developer LLC's twice, in separate buildings, in recent years. How would you now advise affected unit owners, and the Buyer's Agents who represented them in their purchases? Would love your thoughts here.
Please also view our posting on BlogChicagoHomes.com for more details, as well as links to detailed coverage of this matter in the local Edgebrook-Sauganash Times Review, part of the Chicago Sun-Times Newspaper Group.
DEAN & DEAN'S TEAM CHICAGO