Yitzy Klor’s Strategic Properties Blasted in Court Over Delays

Sellers of a $96 million Loop condo buyout are getting antsy that, like another one of his deals, Yitzy Klor won’t be able to close on this one anytime soon, either.

Another extension was granted to Klor’s Strategic Properties of North America to complete Chicago’s priciest ever condo deconversion for $190 million at the 467-unit 10 East Ontario Street. The owners of the condos the company has targeted for a similar transaction are starting to wonder if they’re in for a similar marathon.

Some sellers are already looking for an exit. They see the writing is on the wall for a holdover like what the sellers at Ontario Place are experiencing. There, condo owners have waited three years to close and have granted at least three extensions to Strategic in the last seven months — including one just last week by the River North property’s condo association board that stretches into the end of May.

Now, with some of the sellers at Ontario Place saying they wish their deal was terminated while Strategic continues struggling to cough up the purchase price, condo owners also want to pump the brakes on their sale of the 47-story, 309-unit building at 200 North Dearborn Street that Klor’s firm is also buying out in bulk.

Like the Ontario Place sellers, they entered a deal with Strategic after a vote that showed owners of at least 85 percent the building’s total value — the legal bar condo deconversion offers must clear to close and force even no voters to accept the deal and relinquish their home.

“Even yes voters are frustrated by the lack of proof of funding and continued extensions that five board members get to control,” said Catherine Graham-Driscoll, a unit owner at 200 North Dearborn who voted against the sale.

She’s not alone. Jhade Li, an owner of condos in both Ontario Place and the Dearborn building, favors making it harder for Strategic to drag its feet on the Dearborn deal, which the sellers recently started signing closing documents to complete despite not yet having a final closing date.

“They will be forced to either fund the Dearborn deal immediately or walk away,” Li wrote on social media, adding, “we will have [a] chance to get a better price.”

The Ontario Place ordeal isn’t the only matter that has stretched over three years for Klor’s firm, which didn’t return requests for comment.

On top of getting another extension at Ontario Place, last Thursday morning a Cook County judge blasted the lawyers for Strategic and the investor suing the firm for allegedly not getting his fair share out of a $65 million multifamily sale the company pulled off years ago in Chicago’s northwest suburbs.

The suit claims Strategic diluted the investor’s portion of proceeds he was owed out of the transaction and cost him hundreds of thousands of dollars that he wants to be paid back.

Even after several motions and a judge’s ruling on whether Strategic complied with a subpoena or performed a “document dump” of 42,000 unorganized pages in response to the lawsuit, Frank Lara, an attorney for investor Ari Haas of Monticello Investments, and Noah Siegel, a lawyer defending Strategic, are still at odds on whether they’ve shared the appropriate materials with each other.

“Does any other judge in the commercial section allow for this kind of back and forth on minute discovery issues?” Judge Mary Colleen Roberts said. “There is nothing you’re asking me to do except hear each of your sides about a point of contention in a conversation you had. I need you guys to work together. It’s a 2020 case. It has to get done soon.”

Neither attorney returned requests for comment.