‘It is a black hole in our downtown area’: Mount Prospect moving ahead with buying former Chase Bank building
For years, litigation and eventual foreclosure stalled the development of the former Chase Bank building property in downtown Mount Prospect.
That could all change soon. The village board voted Tuesday to move ahead with spending $5 million to buy the vacant six-story property at 111 E. Busse Ave.
The money will come from the Prospect and Main Tax Increment Financing District, which will use the proceeds of a loan from the village at 4% interest to be paid off by 2035.
A judicial deed will be issued subject to a court order. The village will get clear title from owner ZRM Enterprises. The property will be insured by Chicago Title Insurance Company.
“I would describe the title insurance as the belt and the judicial deed as the suspenders of this transaction,” Village Attorney Lance Malina said.
That’s because the property is entangled in litigation involving Jawad Rabi and ZRM Enterprises, former owner Gus Dahleh and a lender, NPI Debt Fund II, LP. Eventually, the building became locked in foreclosure.
The $5 million will be put in escrow, minus money to pay for back property taxes, while litigation continues.
The majority of the trustees agreed it was time to make a move.
“It is a black hole in our downtown area, and we need to develop this,” Trustee Terri Gens said.
The only no vote came from Augie Filippone.
“My concern with this is trying to make the math work,” he said. Pointing out the TIF has 14 years of life left, he said there is a limited pot of TIF money available and an expected demand for future road projects.
He also expressed concern that the village is spending $5 million for a property that Village Manager Michael Cassady said was appraised last year at between $2.25 million and $2.75 million.
“When the private developer buys that property, they're not going to pay $5 million,” Filippone said.
Cassady said the village received an appraisal in 2022 for $4 million. The reduced figure took into account the cost of demolition and relocating antennas on the roof, he said.
The property at one point had been under contract to Greystar Real Estate Advisors in 2019 for $5.6 million.
Cassady said the village is in a strong financial position, while the Prospect and Main TIF is overperforming. He said a surplus of $15.9 million is projected at the retirement of the TIF in 2039.