Izzy Rotenberg Chicago Foreclosures Keep Costing Lenders

Troubled Brooklyn-based dealmaker Yissocher “Izzy” Rotenberg’s lenders aren’t shielded from the Windy City’s elements, as water and fire are costing big bucks long after multifamily real estate foreclosures could be over with.

The implosion of Rotenberg’s South Side apartments empire was supposed to end in foreclosure court. Instead, a trail of scorched assets, astronomical utility bills and high-stakes legal standoffs left prominent fix-and-flip hard money lenders trapped in operational nightmares, bleeding cash long after initial defaults and court-ordered auctions.

Cook County legal records reveal the staggering cost of cleaning up after Rotenberg, whose aggressive Chicago acquisition spree burned through $48 million on his path to controlling around 500 units on the South and West sides. While he faced over $30 million in foreclosure lawsuits over the past couple years and most properties have been returned to his lenders, a few, including New York-based Roc 360 (formerly called Roc Capital) and Asset Based Lending are still working through obstacles.

The extended employment of the various properties’ court-ordered receiverships are racking up more costs for the creditors as well as other real estate service providers.

At 7908-7926 South Ingleside Avenue, Roc seized the 34-unit Chatham building only to inherit a hazard zone. By early 2026, the property was fire-damaged, stripped of plumbing and overrun by squatters bypassing electrical panels to steal power, according to the lender’s legal filings. The property became so unmanageable that the lender begged a judge to order the Chicago Police to force-vacate the premises. Worse, a pending exit sale around $800,000 to another New York-based investor with significant Chicago multifamily holdings, Yosef Grunwald, was paralyzed by the city of Chicago over a disputed $210,000 unpaid water bill.

Roc Capital’s ownership entity last week filed an emergency court motion to adjudicate the water bill down to a “reasonable amount,” fiercely disputing the city of Chicago’s calculations by claiming the 34-unit building had no active leaks and that the city’s meter was faulty.

Roc and its attorney didn’t return requests for comment, and neither did Grunwald, who’s also separately facing a $6 million foreclosure lawsuit brought by Fannie Mae for properties at 7945 South Drexel, 7948 South Ingleside and 8032 South Ellis avenues.

Meanwhile, Asset Based Lending, led by CEO Kevin Rodman, has been plunged into a parallel nightmare at 447 East 80th Street. Following Rotenberg’s $1.5 million loan default, a devastating April 2024 fire left the 11-unit property in ruins. Though Rodman’s firm moved quickly to foreclose and successfully installed a court-appointed receiver to take control of the building, the case quickly bogged down under a high-stakes insurance standoff.

As the lawsuit drags on, the building has sat open to the elements. ABL’s total debt has ballooned to $2.3 million, forcing the lender to advance over $124,000 of its own cash for property preservation and delinquent taxes just to prevent city demolition. Compounding the chaos, a court-appointed receiver is now suing State Farm within the foreclosure case, accusing the insurance giant of statutory bad faith for withholding a $850,000 fire claim payout under the pretext of ownership confusion.

“State Farm has refused to comply, asserting the receiver ‘is not the owner,’ despite the court’s order expressly authorizing the receiver to collect insurance proceeds and records relating to the property,” an attorney for receiver Curtis Bettiker of Chicago Neighborhood Resources wrote in a court filing.

Attorneys representing State Farm in March asked the court for more time to respond to Bettiker’s allegations. A new hearing in the case is scheduled for July 28, records show. The insurer’s lawyers on Friday didn’t return requests for comment and neither did Bettiker nor his attorney.

As these court battles stretch through 2026, Rotenberg’s collapse underscores a grim reality for bridge lenders: In the South Side of Chicago’s distressed multifamily market, taking back the property is often just the beginning of the financial bloodbath.