Like the proverbial cat with nine lives, the Lake and Lathrop condominium project in River Forest survived a vote by the River Forest Village Board Aug. 28 that could have resulted in the plug on the long-delayed project being pulled.
Board members voted 4-2 to grant the developer, Sedgwick Properties, yet another in a string of building permit extensions. However, whereas the extension runs through Aug. 30, 2024, it comes with a series of conditions that must be met by Sept. 15. Trustees Erika Bachner and Katie Brennan voted against granting the extension.
The project has been on life support since April when Beverly Bank and Trust, which is financing the development, filed suit against Sedgwick Properties. Through the lawsuit, filed in Cook County court, the Wintrust-affiliated bank is looking to claw back $4.2 million from the $20 million line of credit it issued in 2022. In the lawsuit, the lender has reportedly cited several provisions in its loan agreement with Sedgwick affiliates that were violated, including that the contract required the borrower to stay in compliance with local regulations and to stick to a tighter construction timeline.
Securing viable financing, and providing proof of such financing to the village, is the top condition Sedgwick Properties faces by Sept. 15. In addition, the developer must also resolve the pending litigation with Beverly Bank and Trust. Other conditions are: paying the village $98,905.32 for the permit extension fee and paying $21,000 in unpaid property taxes. If any of the conditions are not met, the village will revoke the permit and issue a stop-work order.
Sedgwick Properties representatives Mark McKinney, project manager, and Marty Paris, president, faced tough questioning from all board members with those from Bachner and Brennan being the toughest.
“It’s very difficult to get information from you,” Bachner said. “Why don’t you communicate with us?
“We keep giving them leeway,” she added. “This is at least the third time.”
Brennan took issue with Sedgwick Properties not paying property taxes.
“Why don’t you pay your taxes?” she asked, calling it a pattern of non-payment. “I’m concerned this pattern will continue if we give you this permit.”
Comparing village officials to characters in the Peanuts comic strip, Brennan asked how many times they would allow Lucy to pull the football away.
“We keep saying, ‘This is the last time,’” she added.
Dozens of residents, most living in the neighborhood near Lake Street and Lathrop Avenue, attended the meeting, with 11 addressing the board. All 11 advocated voting against the extension, citing the developer’s financial troubles, an overall lack of progress on construction, and the condition of the site itself and surrounding area.
“You need to address the appearance,” Village President Cathy Adduci told McKinney and Paris. Referring to the use of plywood covering broken sidewalks, she said, “We’re not going to allow our residents to walk on plywood.”
McKinney and Paris defended their organization.
“We acknowledge the delays,” McKinney said, citing the pandemic and a concrete workers strike as contributing factors. “We’re not here to make excuses.
“The biggest delay is the lender pulling out. We are working diligently to obtain financing. We are very committed to completing the project.”
Paris blamed Beverly Bank for the most recent delay, saying they are “very unhappy” with Wintrust.
“The project hasn’t progressed as we would have liked,” he added. “We hope we can work things out with Wintrust.”
If not, he said, they have “backup lenders.”
Adduci blamed some of the early delay in the project on contaminated soil from a dry cleaning business that was once on the site. She said village officials were not only aware of the contamination but also concerned that it was spreading, which could have affected the village’s public works land as well as properties of residents.
“This has been a long, winding road,” she said, but added, “I think it’s a good project.”
Adduci said if Sedgwick Properties misses the Sept. 15 deadline, village officials will work with Wintrust.
She said partnering with a new developer is “not that easy” and “a long process.”
“We will stay the course but it will take time and money. We know what our community wants.”
In addition, Sedgwick Properties has agreed to provide a construction update at each regularly scheduled village board meeting until certificates of occupancy are issued for all residential units. In addition, the developer must obtain certificates of occupancy for all residential units by the August 2024 permit deadline. If work is required beyond the deadline, Sedgwick Properties must pay $197,810.64 for a three-month permit extension. If work is required beyond the deadline, the developer must pay $36,000 in outstanding fines owed to the village. If they hit the deadline, that amount will be reduced to $2,000.
Trustee Respicio Vazquez stressed the importance of providing updates at village board meetings.
“I’m not happy with it either,” he said. “Hopefully you can get your financing.”
The project has been on the drawing board since before the village board approved, in 2016, the proposal by Lake Lathrop Partners LLC to build a four-story, mixed-use development containing 22 condominium units with 14,000 square feet of retail space. Variations on the same project had lurched and lingered for a decade previously. The original project included another story and eight more units but was scaled back.
The project has experienced a series of delays over the years, including environmental cleanup from the dry cleaner and a lawsuit involving a tenant who did not want to leave.