Lender Foreclosing on Shuttered Suburban Chicago Brewery

The hangover from the craft beer boom has turned into a legal headache for Steve Soble, owner of District Brew Yards.

Waterman Bank filed a foreclosure suit against the ownership entity of the recently shuttered beer hall’s Wheeling outpost, alleging the borrower owes more than $2.3 million in unpaid principal, interest and fees. The complaint, filed in Cook County Circuit Court late last month, marks the latest distress signal in a local brewing scene that has seen a wave of closures from industry titans and neighborhood favorites alike.

The lawsuit targets 700 N Milwaukee LLC and its guarantors, Dale “Steve” Soble and wife Kendall Soble. Steve Soble, a 36-year veteran of the Chicago brewery and dining scene who also founded Burnt City Brewing, opened the Wheeling brewery in 2022 as a suburban expansion of his popular West Town concept. It allows District Brew Yards patrons to pour their own beers from a wall of taps.

But the taps ran dry quickly. According to Waterman’s complaint, the borrower stopped making payments on the $2.3 million Wheeling loan in April 2024. While the two sides apparently attempted to salvage the deal through multiple forbearance agreements, the bank alleges the borrower defaulted again In August 2025, court records show.

As of last month, Waterman Bank claims the total payoff amount has swelled to more than $2.3 million, with interest accruing daily.

The foreclosure filing comes just months after Soble publicly announced a “wind down” of District Brew Yards’ operations. In September, reports indicated the 11,900-square-foot Wheeling property at 700 North Milwaukee Avenue was being marketed for sale with an asking price of roughly $3.6 million. At the time, Soble cited a desire to retire and a difficult market as reasons for the exit.

The legal action suggests a buyer hasn’t materialized at a price sufficient to clear the debt before the bank’s patience ran out, but it remains on the market with CBRE brokers Tom Svoboda and Dominic Soltero. It is now asking $2.7 million, according to an online listing. The West Town property in Chicago is still operating, but the property is also listed for sale asking $4.5 million.

Waterman’s foreclosure is emblematic of a broader crisis facing the middle market of the hospitality industry — full-service venues sandwiched between high-end dining and quick-serve chains.

“There has been a real pullback in mid-level dining experiences that is not just craft beer-focused,” Steve Soble told The Real Deal. “A lot of places on the high end are doing really well. The middle is being hollowed out.”

The craft beer sector, once a darling of retail real estate, has been battered by a perfect storm of headwinds. Inflation has squeezed margins, but a cultural shift is proving even more damaging: Americans are simply drinking less.

Industry analysts have also pointed to the rise of GLP-1 weight-loss drugs like Ozempic, which can curb cravings for both food and alcohol, as a growing threat to revenue. Combined with the “Dry January” movement extending year-round for many younger consumers, volume-dependent businesses like large beer halls are finding it harder to cover the rent.

District Brew Yards is far from alone in its struggles. Miskatonic Brewing shuttered its suburban Chicago location in Darien this month, blaming the downturn on “people drinking less” and the financial strain of a failed expansion. That closure followed the high-profile exit of Lagunitas, which closed its large Chicago production facility and taproom in 2024 after a decade of operation.

However, a $12 million foreclosure lawsuit for the Great Central Brewing property on Chicago’s Near West Side filed by Wheaton-based lender T2 Capital in 2023 was resolved without stripping the property from the borrowers. “The sponsor was resourceful and was able to recapitalize the property,” T2’s CEO Jeff Brown said Friday.

David Avram, one of the original owners and borrowers for the Great Central property, took on several million dollars of additional debt tied to the brewery building over the past year in an attempt to straighten out the company’s financial affairs, and T2’s foreclosure was dismissed in early 2025, court records show.

Meanwhile, Waterman Bank has requested a judgment of foreclosure and sale for the Wheeling District Brew Yards, as well as the right to appoint a receiver to take control of the property. An attorney for Waterman didn’t return a request for comment. The lawsuit’s next court date is scheduled for a June 29 case management hearing, online records show.