Developer Sues Chicago Investor Over Old Town Property

A heated lawsuit, stemming from the collapse of crowdfunding firm Prodigy Network and a botched apartment project in Old Town, continues to escalate.

Five years after a venture led by New York developer Joe McMillan bought the parcel at 1400 North Orleans Street for $14.4 million, he’s now suing Ananthan Thangavel, a Chicago investor that seized the property, Crain’s reported.

McMillan claims that Thangavel improperly acquired the property for next to nothing, calling it “a self-interested transaction that did not constitute fair dealing.”

The site was originally slated for a seven-story, 254-unit apartment building. However, the project was derailed after Prodigy Network, which raised $22 million in equity for the development, filed for bankruptcy in 2021.

Through a bankruptcy auction, Thangavel paid $7.65 million for Prodigy’s 90 percent stake in the venture formed to develop the apartment. He then fired McMillan from the company and transferred the property to another of his ventures for just $10.

The McMillan venture scooped up the property in 2018, and it was worth an estimated $16 million in November 2021. Thus, the McMillan venture should have received at least $1.6 million based on its 10 percent stake in the development company, and by extension, the property, the outlet said, citing the lawsuit.

McMillan filed the lawsuit in Cook County Circuit Court in late May. He’s seeking damages of at least $1.6 million. It’s unclear what Thangavel plans to do with the site, and it remains to be seen whether the apartment even gets built.

A firm led by McMillan, DDG, originally partnered with Chicago-based Marc Realty on the Old Town project, along with one in Fulton Market. But DDG bought out Marc’s stake in the developments prior to Prodigy’s bankruptcy.

—Quinn Donoghue