After spending the last three years buying dozens of buildings and hundreds of apartment units, Shaya Wurzberger is getting a taste of distress in Chicago’s multifamily market.
Wurzberger, 31, is a Brooklyn-based investor who entered the Windy City scene in 2022 with a series of acquisitions that rapidly assembled a large portfolio under his firm Levav Properties.
He said he owns 1,000 apartment units that he has spent about $100 million to buy since 2022. An analysis by The Real Deal verified he owns upward of 500 units, which he spent $50 million to purchase between 2022 and last month, according to public records, though the analysis was not comprehensive of all of Wurzberger’s properties.
He’s now facing a $12 million foreclosure lawsuit filed earlier this year by New York-based lender Roc Capital. The deal subject to the dispute stands out for how quickly it disintegrated.
Roc provided the loan for the purchase of a 14-building portfolio spanning 128 units on the South Side of Chicago in February 2024, Cook County records show. Wurzberger purchased them from Yasir Kanan for $14 million, or $109,400 per unit.
By November, however, Wurzberger’s firm was in default on the debt, according to the lawsuit. His plan is to walk away from the properties and allow Roc to take over their ownership. The buildings ran into problems he didn’t anticipate, and loan reserves meant to fund rehabs on the properties weren’t properly released, he said.
“I’d rather cut it short now instead of taking money from good properties to fill this debt gap,” Wurzberger said.
While he’s mostly taken a pause on purchasing properties, he did buy one last month, a $650,000 purchase of a mixed-use building at 10401 South Ewing Avenue. He has raised money from investors to buy his portfolio and contends Levav has greater capacity to care for buildings than real estate investors who have recently fallen into financial trouble with Chicago buildings.
“My biggest pitch on the South Side, which is still true these days, is there are high cap rates that are selling. The reason is because not a lot of people are capable of operating properly,” Wurzberger said. “If you do figure out how to manage it properly, you get to make a higher return than in other markets.”
The biggest buildings Roc Capital is seeking to take from Wurzberger are a 17-unit mixed-use property at 1527 West 78th Street, a 16-unit mixed-use property at 7905 South Champlain Avenue and a 13-unit property at 11107 South Emerald Avenue.
The others are 6548 South Perry Avenue; 9050 South Ashland Avenue; 8752 South Cottage Grove AVenue; 8001 South Wood Street; 907 West Garfield Boulevard; 6049 South Princeton Avenue; 8754 South Ashland Avenue; 6617 South Perry Avenue; and 7348 South Artesian Avenue.
Roc Capital has been involved in foreclosure disputes with at least one other East Coast investor. The lender earlier this year seized the 34-unit 7908 South Ingleside through foreclosure from Brooklyn-based multifamily investor Yissocher “Izzy” Rotenberg, who is facing mounting financial pressure from Roc, records show. The lender has another pending foreclosure lawsuit against Rotenberg, for the 31-unit 1901 West Pryor Street, which is being marketed for sale for $3.6 million by Kiser Group’s Aaron Sklar and Noah Birk.
Roc alleges Wurzberger defaulted on the loan by failing to pay interest and principal from November through at least February, according to the lender’s complaint. The landlord faces an additional charge of over $3,000 per day until the dispute is resolved, the suit says.
Wurzberger has also struggled with building code violations at multiple properties, including for not having working heat in wintertime, records show. He has also cleared multiple housing court cases by addressing issues with his buildings.
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