John Buck III delinquent, seeking extension on struggling O’Hare office loan

A firm led by the son of a Chicago real estate royal is delinquent on an $18 million loan secured by an office building near O’Hare International Airport.

Free Market Ventures, led by John “Jack” Buck III, has asked for a one-year extension on a loan secured by the 180,000-square-foot property at 6400 Shafer Court in Rosemont that matured last month, according to data from DBRS Morningstar.

The loan was originated in 2019 by Varde Partners and then packaged into commercial mortgage-backed securities and sold to investors in financial instruments. Buck, son of the John Buck Cos. founder John A. Buck II, and Free Market Ventures did not respond to requests for comment. Representatives for Varde Partners and Trimont Real Estate Advisors, the special servicer tasked with overseeing the debt since it began showing signs of trouble, declined to comment.

The loan was originally supposed to come due in January 2022, and then the younger Buck received an extension to January 2023, according to Morningstar data. It was then watchlisted — usually a sign a lender believes there’s a growing chance it won’t be repaid — in December 2022.

The maturity date was then pushed back to May 1, 2023 according to a report from Trimont, but in March the special servicer said the parties were working toward another extension.

The maturity date was pushed back again to June 1 and then to Sept. 1, according to Trimont. On Sept. 18, the special servicer reported that the borrower and lender were working on an agreement to stretch the maturity date to September 2024.

The building’s occupancy was 55 percent as of last month, down from 82 percent when the loan was issued. Free Market Ventures bought the property in 2017 with Canada-based Second City Real Estate as a partner, according to public records and previously published reports.

While the O’Hare office submarket boasts proximity to both the airport and the city, the area’s advantages haven’t shielded it from distress. The 302,000-square-foot International Tower on West Bryn Mawr Road in Chicago sold for roughly a 25% discount last month, and Canada’s Adventus Realty Trust faced a $114 million foreclosure complaint over a complex it owns near the airport over the summer.

And Varde Partners, the originator of the CMBS loan to John Buck III’s firm, earlier this year took over a nearly fully leased, 627,000-square-foot office building near O’Hare known as Triangle Plaza, when its former owner Alliance HP decided to hand back the keys rather than fight a foreclosure of a $78 million debt.

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