Foreclosure suit hits Gold Coast corporate apartments
(Crain's) — A fund formed to rid Swiss bank UBS A.G. of toxic assets has filed a $20-million foreclosure suit against the developer of a high-end corporate apartment building in the Gold Coast.
Reflecting the continued difficulty landlords face as they try to refinance their properties, developer Jerome Cedicci says he did not repay the loan on the 27-unit building at 70 E. Walton St. when it came due Jan. 11. Mr. Cedicci renovated the 13-story tower into luxury extended-stay suites after borrowing $20 million from UBS in 2007.
"I cannot talk about (the case) because I am in negotiations with the bank," he says. He says he expects the suit "to be dismissed or resolved."
UBS transferred the loan last year to the StabFund, a $39-billion fund the Swiss National Bank set up in the midst of the global credit crisis to stabilize Swiss financial markets.
A spokesperson for the central bank wasn't available late Tuesday, and a lawyer representing the fund did not return a phone call.
Named the Walton Residence, the building was formerly the home of the Elizabeth Arden Salon. It features fully furnished suites ranging from $3,900 a month for a one-bedroom unit to $15,000 for three bedrooms, according to the property's Web site. Rates vary depending on length of occupancy, with shorter stays costing more on average.
Mr. Cedicci was the owner of the former Hotel Wacker at 111 W. Huron St., which he sold for $24 million in 2007. But he may be better known for a controversial 44-unit condominium project he tried to build several years ago in a West Side manufacturing district. The city blocked the partially built development at 373 N. Morgan St. in 2005 after determining that its building permit was improperly obtained, leading to the firing or resignation of several city employees.
