Mr. Donald Trump filed suit against the lenders on his unfinished Chicago skyscraper, plunging the project into legal turmoil and highlighting the credit crunch’s pervasive effects on real estate.
Mr. Trump is suing to extend a $640 million senior construction loan on the 92-story Trump International Hotel & Tower from a group of lenders led by Deutsche Bank AG and including a unit of Merrill Lynch & Co., Union Labor Life Insurance Co., iStar Financial Inc., a publicly traded real-estate investment trust, and Highland Funds, a unit of Highland Capital Management LP.
The tower, which contains 339 hotel rooms and 486 condominiums, will be the second-tallest building in the U.S. behind Chicago’s Sears Tower and is expected to be completed in mid-2009. The hotel, on the lower floors, opened earlier this year. But sales of both the hotel rooms and the condominiums have come in below original estimates and the project’s current projected revenue remains short by nearly $100 million needed to pay off the senior lenders.
Mr. Trump has put $77 million of his own equity into the tower, which he would stand to lose in a potential foreclosure. Other than a $40 million guarantee to complete the project, Mr. Trump has no recourse obligations to the project. A Trump spokesman declined to comment.
Looking for a Chicago Real Estate Attorney ?
As we all know Trump is a pretty sharp guy. I bet he gets the last laugh on this one. I’m a big Trump fan, can you tell?
Source
0 responses so far ↓
There are no comments yet...Kick things off by filling out the form below.
Leave a Comment