Foreclosure suit hits McHenry County airfield
(Crain's) — The economy is so weak, even airports are facing foreclosure.
Harris Bank has sued to collect about $14.3 million on an unpaid loan on Galt Airport in northwest suburban McHenry County, a 60-year-old airfield for private pilots that in recent years has also become an outdoor concert venue.
For many years, small private airfields have struggled to stay in business, threatened by urban sprawl, increasing regulation and the expanding airspace of major airports like O'Hare International Airport. Now, the economy may be posing a new challenge.
"As soon as money gets tough, one of the first things you do is stop flying because, gee, it's expensive," says Evanston author Laurence Gonzales, who wrote the 1993 book "One Zero Charlie: Adventures in Grass Roots Aviation" about the airport's original owner and Mr. Gonzales' own exploits as a stunt pilot.
The airfield, at 5112 Greenwood Road in Wonder Lake, is controlled by Ivan Djurin, a real estate investor and licensed flight instructor. In addition to the airfield lawsuit, filed Jan. 26 in McHenry County Circuit Court, Chicago-based Harris Bank sued the same day to collect about $3.3 million on a Lake Forest house controlled by Mr. Djurin, according to notices of the complaints filed with the recorders' offices of McHenry and Lake counties.
The airfield does not have a control tower and features a 3,000-foot paved runway.
Mr. Djurin, of Lake Forest-based North Street Properties, did not return messages requesting comment.
Copies of the complaints could not be obtained and reasons for the alleged loan defaults could not be deternined. It is unclear whether the litigation also involves any of North Street's holdings. The company owns six apartment properties: three in Pennsylvania, two in Kentucky and one in south suburban Richton Park, and three hotels in Lexington, Ky.
Harris is suing to collect a $13.5-million loan issued in 2006. The loan currently requires monthly payments of principal and interest of about $98,500. A balloon payment of $12.7 million is due in June 2011. The annual interest rate is 7.25%.
A bank spokesman declines to comment, except to say, "We worked with Mr. Djurin, like we do with all of our customers at Harris, looking to . . . help them with the financial challenges they may be facing."
Two ventures managed by Mr. Djurin bought the airfield in 1998 from its original owner, Arthur T. Galt Jr., who died in 2002. The Djurin ventures paid $2.1 million, property records show. The field is called "One Zero Charlie" for its Federal Aviation Administration designation, 10C.
The Djurin ventures estimate that Galt's combined takeoffs and landings total about 44,000 a year, according to reports filed with the FAA. The estimate hasn't changed in 10 years, an FAA spokesman says.
In recent years, the sprawling airfield's grounds also have been the site of concerts, including a 40th anniversary celebration last year of the 1969 Woodstock music festival in upstate New York.
