A high-rise tower in the Loop that was supposed to have Chicago’s largest co-living property is now at risk of foreclosure.
A lender filed a $22.8 million foreclosure suit against the owner of the 41-story tower building at 105 West Adams Street. The owner, Musa Tadros, had planned to convert the office space in the building into apartments including a 505-bed co-living portion, according to Crain’s.
The lender, First Midwest Bank, alleges that Tadros failed to make the interest and principal payments on its loan. Tadros initially defaulted on the loan in 2018 when the property failed to meet its required ratio of cash flow to its debt payment.
To help alleviate these challenges, Tadros planned to sell the top 31 floors of the building last fall. The buying group, led by investor Andy Ahitow, said it would redevelop the space into co-living space that would be managed by New York-based Common.
But Tadros and Ahitow failed to come to an agreement and the deal fell through.
Tadros claims that he had a deal with another buyer that would prevent the property from going into foreclosure. But the buyer is having difficulty getting financing for the acquisition during the pandemic, according to Tadros.
Another uncertainty is the 429-room Club Quarters hotel inside the building. The hotel’s owner, Blackstone Group, stopped making payments on a $274 million loan in June and decided to hand it over to a lender. The firm previously said it was “a very small investment that had been written down prior to Covid-19 as a result of unique operational challenges.”
[Crain’s] — Keith Larsen