Chicago’s Cité Owner Jiazhao Chen Faces More Foreclosures

Legal trouble is mounting for Chicago real estate investor Jiazhao “Frank” Chen, who is facing two more foreclosure suits for $13.4 million, with allegations of allowing criminal activity at his properties and mixing company funds.

Chen, who purchased the former Cité restaurant at the top of Lake Point Tower out of bankruptcy, is facing a barrage of foreclosures across his dozens of properties in Chicago’s Chinatown and Bridgeport.

The new foreclosures push Chen’s alleged defaults to more than $65 million at 37 properties with more than 150 rental units, according to court records. The Cook County Assessor’s Office appraised the affected portfolio at a combined $33.9 million in 2025, far below the debt owed.

Beyond simple failure to pay, one lender is accusing Chen of using the same bank account for several entities he used to procure loans and buy properties in a violation of the loan agreements.

Both lawsuits were filed in Cook County Circuit Court. One dates back to November but has not been previously reported, while the other was filed Feb. 25.

In that lawsuit, filed in November, the debt holder, Treaty Oak Mortgage Trust, said in letters included in court documents that Chen mixed the funds for at least five entities, including Power One Investment and Portfolio 05-2024 Investment. Those entities are the subject of two other foreclosures against Chen, The Real Deal previously reported.

The lender specifically named Chen a defendant in the lawsuit, arguing his alleged breach of the agreement means he’s personally liable for the $8.1 million debt.

The lawsuit hinges on a $7.9 million mortgage Chen took out with CoreVest covering four multi-unit properties. The buildings ranged from four to seven units with commercial space. The most expensive of the group was the property at 255 West 22nd Place in Chinatown, which has an assessed value of $1.6 million, according to county records.

A representative for Fay Servicing, the servicer on the loan, said the company was unable to comment on the lawsuit.

Chen did not respond to a request for comment.

In a separate new lawsuit brought by special servicer Situs filed Feb. 25 on behalf of investors in a loan that originated with CoreVest, the servicer accused Chen of allowing criminal activity on his properties. It’s the same charge the servicer lodged in several other lawsuits brought against Chen last week.

“We understand that criminal activity has been allowed to take place at one or more of the properties,” Situs wrote in a default notice included in court filings. That activity constitutes a “public or private nuisance” that could affect the portfolio’s value, the servicer said.

Situs did not respond to a request for comment.

The total amount due on that loan has swelled to $5.3 million from an initial $4.5 million mortgage, according to the lawsuit. The mortgage is tied to six properties in Chinatown and the South Loop. The most expensive of the group was a multi-unit building at 267 West Alexander Street that the city assessors’ office pegged at $480,000.

In both cases, the lenders allege Chen stopped making payments on his debts in September, which is the same timeline laid out in previous cases reported by TRD.

The distress comes three years after Chen purchased the former Cité space, making a name as a major commercial investor. Chen purchased the restaurant, which had shut down and was in financial distress, for $4.7 million. Since the sale, no new restaurant has opened at the spot that was once revered for its panoramic lakefront and city views.