Lenders want to stop South Side apartment portfolio “fire sale”

Court-appointed receiver looks to unload hundreds of units for investors claiming they were scammed in Ponzi scheme

TRD CHICAGO /
Jun.June 02, 2020 03:10 PM
5001 South Drexel Boulevard in Kenwood (Trulia)

5001 South Drexel Boulevard in Kenwood (Trulia)

Lenders on nearly 400 South Side apartments are trying to stop a court-appointed receiver from selling them at what the lenders deem “fire sale” prices.

The court-appointed receiver, Kevin Duff, is looking to sell a 12-building portfolio for investors who say they were scammed by Florida-based EquityBuild, which was accused in 2018 of operating a widespread Ponzi scheme, according to Crain’s.

The SEC says Jerome Cohen and his son Shaun Cohen raised at least $135 million from nearly 1,000 investors starting in 2010, and deployed the money into 79 apartment buildings and 34 single-family homes, Crain’s reported. But the firm and its affiliates sustained heavy losses and resorted to paying early investors with money from new investments, according to a civil lawsuit.

Duff, who sold numerous buildings last year, is asking a federal judge to approve the sale of 11 properties with 161 units for a total of $6.9 million, about 20 percent less than EquityBuild paid several years ago. One of the buyers is Longwood Development, which is acquiring seven of the properties.

Lenders that include Fannie Mae and Freddie Mac are asking the judge to halt the sales until coronavirus-related restrictions in Illinois are lifted and the real estate market stabilizes, according to Crain’s. [Crain’s] — James Kleimann


Related Articles

arrow_forward_ios
Donovan Eckhardt and Alison Victoria

“Windy City Rehab” stars Alison Gramenos, Donovan Eckhardt sued for fraud yet again

“Windy City Rehab” stars Alison Gramenos, Donovan Eckhardt sued for fraud yet again
Alison Victoria, 1700 W. Wabansia Ave. (Credit: Slaven Vlasic/Getty Images, and Google Maps)

Alison Victoria: Lawsuit against me is baseless and lawyer should be sanctioned

Alison Victoria: Lawsuit against me is baseless and lawyer should be sanctioned
Placeholder image

Elite Lincoln Park private school accused of shady condo buy

Elite Lincoln Park private school accused of shady condo buy
401 S. State Street (Credit: Google Maps)

Robert Morris U. skipped out on $1M April rent, landlord charges in suit

Robert Morris U. skipped out on $1M April rent, landlord charges in suit
1700 W. Wabansia Ave in Wicker Park and  HGTV host Alison Victoria Gramenos (Credit: Google Maps)

Another angry couple wants “Windy City Rehab” to take back their leaky house

Another angry couple wants “Windy City Rehab” to take back their leaky house
Discovery Inc. CEO David Zaslav, "Windy City Rehab" host Alison Gramenos and 2308 W. Giddings St. (Credit: Getty Images)

Couple suing “Windy City Rehab” stars now going after the real money

Couple suing “Windy City Rehab” stars now going after the real money
Orland Park landlord sued for housing discrimination (Credit: iStock)

Orland Park landlord sued for racial discrimination

Orland Park landlord sued for racial discrimination
301 West North Avenue and Sedgwick Development President Marty Paris (Credit: iStock)

It’s partner vs. partner in lawsuit over Old Town resi project

It’s partner vs. partner in lawsuit over Old Town resi project
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...