Taxman venture faces foreclosure in Oak Park
The Oak Leaves Building in Oak Park. Photo from Oak Park Historic Preservation Commission.
(Crain's) — In the home of Frank Lloyd Wright, an Art Deco office building faces foreclosure.
A venture headed by veteran developer Seymour "Sy" Taxman has been hit with a $4.5-million lawsuit on 1140 Lake St., a five-story building in Oak Park constructed in 1929.
A subsidiary of Miami Beach, Fla.-based LNR Partners Inc. filed suit Aug. 30 in Cook County Circuit Court against the 64,590-square-foot structure, which was designed by S. N. Crowen & Associates. The architectural firm is better known for Willoughby Tower, a 38-story skyscraper at 8 S. Michigan Ave. in downtown Chicago also built at the beginning of the Great Depression.
The foreclosure suit comes almost two months after Mr. Taxman agreed to hand back to another lender a much more mundane property, a strip mall in Elmwood Park, after a default on a $2-million loan.
Mr. Taxman, president of Skokie-based Taxman Corp., says he is in talks to restructure the loan on the historic Oak Park structure, known as the Oak Leaves Building because of a key tenant, Pioneer Press, which publishes the Oak Leaves newspaper. A Taxman venture bought the building for $5.75 million in March 2005, financing the deal with the loan, in the original amount of $4.8 million.
The building is across the street from Oak Park's superblock site, where village officials and Mr. Taxman once planned a large development project. The deal fell apart in 2006, when the two sides could not come to terms.
The designs of downtown buildings contrast with Wright's low-slung, Prairie Style homes that the western suburb is known for.
The loan on the Oak Leaves Building fell into default in December, when the venture started missing monthly payments, according to the complaint.
David Lynch, a partner in the Chicago office of law firm DLA Piper LLP, which represents LNR, declines to comment. A spokeswoman for LNR also declines to comment.
The building is just 63% leased, according to real estate data provider CoStar Group Inc.
Built at a cost of $200,000, the Oak Leaves Building features a distinctive, limestone façade, according to an architectural survey of downtown Oak Park by the Oak Park Historic Preservation Commission, updated in 2005. The interior was later remodeled to become an annex for another architectural gem, the French Renaissance Revival-style Marshall Field & Co. department store at 1144 Lake St., which was also built in 1929, the survey says.
LNR is acting as a special servicer, representing investors who bought commercial mortgage-backed securities (CMBS) that included the loan.
Meanwhile, in Elmwood Park, about 4½ miles away, a venture affiliated with Mr. Taxman consented to foreclosure June 8 on a 10,000-square-foot retail strip at 2834-2850 N. Harlem Ave., court documents show.
The venture in December started missing monthly payments on a $2-million loan, according to the complaint filed by the lender, Aviva Life & Annuity Co., in Cook County Circuit Court. The total amount due, including interest and late fees, was more than $2.25 million.
Built in 2002, the center is roughly half vacant, with tenants such as Subway, Cricket Communications Inc. and a nail salon, CoStar says.
Mr. Taxman declines to comment, saying the matter has been resolved.
The Chicago office of real estate firm Colliers International is now managing the property for Aviva, a unit of London-based Aviva PLC.
