Scott Greenberg Slammed with $17 Million Lincolnshire Foreclosure

A trust controlled by longtime Chicago-area developer Scott Greenberg is working through a $17 million foreclosure on a shuttered Lincolnshire movie theater that he’s held for years after building a big apartment complex next door, according to a suit that has been refiled.

ECD Companies were issued a foreclosure 202 complaint in an initial suit that alleged it missed monthly payments on its mortgage for the recently closed Regal Cinemas theater at 300 Parkway Drive, and claim $15 million that’s still unpaid was due because of the default on the debt. It wasn’t originally scheduled to mature until 2028.

The first foreclosure suit was filed by the loan’s special servicer Mount Street, which represents the lender, and shows how the debt became troubled after Regal in September filed for bankruptcy. The movie theater chain paid its rent through February for the 78,000-square-foot space long owned by Greenberg affiliates. The tenant vacated in the weeks after showing its final film.

Greenberg told the The Real Deal that his personal assets were not at risk, and showed that the federal foreclosure suit was dismissed on June 13, 2023, before another suit was refiled a month later.

In an email Greenberg described the situation as “a foreclosure proceeding that is being conducted amicably between the lender and borrower — a proceeding in which I am not named as a defendant in any capacity.”

The theater used to be even bigger, until Greenberg tore half of it down to make way for 444 Social, the 302-unit apartment complex built next door to the former Regal. His firm used a $67 million construction loan obtained in part from Associated Bank in 2017.

The other half of the movie theater remained, and Greenberg signed a personal guarantee for the $17 million loan he scored from Morgan Stanley for the theater portion of the property partway through the apartment property’s construction, court records show. Morgan Stanley later packaged the debt with other loans and sold off interest in them to financial securities investors.

While the four-story, two-building housing asset appears to have already paid off for ECD — the property scored a $93 million refinancing from a Barings affiliate after it opened in 2020 — the lawsuit demonstrates both the difficulties faced by landlords of big box retail, and the tailwinds that carried multifamily players to big profits in Chicago’s suburbs in recent years.

Mount Street is in talks with brokers to evaluate the health and potential sale value of the former Regal theater, according to credit ratings agency Morningstar. An appraisal of the property has been ordered.

Earlier this year, a project explored by Greenberg that would have cost $30 million and put an e-sports gaming arena near Chicago’s McCormick Place at 2500-48 South Wabash Avenue was scrapped.

Correction: A previous version of this article suggested Greenberg’s personal assets were on the line to pay off the debt and did not disclose the initial foreclosure lawsuit was dismissed on June 13. Greenberg had not provided a comment prior to publishing this story, but reached out to clarify key details of the foreclosure suit.