Hotels dominated Chicago’s real estate headlines this week as developers rear to kick off some new hospitality projects, while an old Gold Coast lodging property was saved from distress.
Fulton Market developers Shapack Partners and CRG are in talks with nascent hotel brand The Global Ambassador, which has a 141-key Phoenix location and is eyeing 170 North Green Street in Chicago. The hotel could operate the hotel component slated for the 40-story mixed-use tower planned on the site, which is also approved for 350,000 square feet of office space, 275 apartments and retail.
On the South Side, developer Allison Davis, through his entity Aquinnah Investment Trust, is proposing to build a 28-story, 250-key hotel property near the almost complete Barack Obama Presidential Library, at 6402 South Stony Island Avenue.
And in the Gold Coast, an investment group led by Wheeling-based Marsha Forsythe acquired the historic 285-key hotel at 1301 North State Parkway, settling a 2023 foreclosure lawsuit against its previous owner, a Gaw Capital affiliate, for allegedly defaulting on a $38.5 million loan.
Chicago multifamily landlords are taking a political stand against the anti-gentrification ordinance that went into effect in Northwest Side neighborhoods and Pilsen this month. They’re trying to rally support to stymie or overturn a rule that gives tenants the right of first refusal to buy apartment buildings imposed as part of the law, claiming that it could prevent sales from closing and deter investment.
Meanwhile, lenders and landlords are still frustrated with each other at major Chicagoland properties.
Bank OZK wrote down an additional $17 million from its loan to Sterling Bay for its stalled Lincoln Yards project, ballooning the total to $38 million that the lender has charged off on its initial $128 million loan to the developer.
Itasca-based Hamilton Partners is also aiming to get a suburban Downers Grove office debt back on track after it was sent to special servicer CW Capital with a $57 million remaining balance and an “imminent” default predicted. The landlord’s co-owner in the property, Accesso Partners, is hesitant to contribute any additional capital to saving the deal as it already faces numerous legal and financial challenges with major Chicagoland real estate loans.
Still, Bank OZK, a key construction lender, hasn’t redlined the Chicago-area from putting new deals on its books. It led a $55 million construction loan that included a $9.9 million mezzanine debt from an insurer to developer VennPoint Real Estate, which is led by Nick Marietti and aims to build 144 rental townhomes in Deerfield with the money.
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