Baum Pounces on Ameritus Office Foreclosure in Deerfield

A new set of owners are making a bet on a distressed suburban Chicago office building.

An LLC tied to David Baum and Paul Fishbein of Chicago-based Baum Realty Group bought a $10.6 million loan backed by an office at 155 Pfingsten Road in Deerfield, public records show.

The loan was originally issued to Chicago-based commercial real estate firm Ameritus by First Midwest Bank in 2018. It was later transferred to Old National Bank in 2022 when the two banks merged.

Ameritus has been in default on its debt payments for the 1987-era office building since March 2023, legal records show. Old National sold the distressed debt in October to the entity tied to Baum and Fishbein, which became the de facto lender and took charge of advancing a foreclosure lawsuit against the property owners in December.

It’s unclear how much Baum and Fishbein paid to acquire the debt, but it likely came at a substantial discount from its face value. It’s unknown what the next steps could be for the property, which as of October was only 43 percent occupied, according to a receiver’s report.

Baum and representatives of Ameritus did not respond to requests for comment.

Although the office market is still on shaky ground from the pandemic, investors have shown interest in buying distressed properties when the price is low enough.

Tenants at the three-story, 119,000-square foot office complex in Deerfield include Nadler Financial Group and NCH Marketing Services. The receiver’s report noted that the building had 14 vacancies totalling 75,000 square feet.

The foreclosure filing comes as Ameritus is trying to shed a similar property in its portfolio.

The company hired JLL to market an eight-story, 220,000-square-foot suburban office building in Northbrook at 400 Skokie Boulevard last year. It has, however, maintained a stronger position than the Deerfield office.

When the Northbrook building was listed, the building was 80 percent occupied with a significant portion of leases signed to clinical healthcare providers rather than traditional office users. The University of Chicago Medicine’s 15,000-square-foot lease for an office specializing in urogynecology and gastrointestinal health services, for example, gave the property a boost.

But public records show that the Northbrook property hasn’t sold and is also currently facing a $14,000 broker’s lien from leasing agent Colliers and a $489,000 contractor’s lien from Woodrow Development.

Meanwhile, the Deerfield foreclosure suit is being pushed forward and the Baum-led group could emerge as the building’s new landlord, should Ameritus fail to pay off the debt in full.

Ameritus’ portfolio also includes Wacker Drive office buildings and a handful of other multifamily and office assets in Chicago and its suburbs.