Thursday, October 21, 2010

Another bank lawsuit filed against Palermo developer Shipka. This is one is over Murano loans




There's another bank lawsuit against the developer of Palermo Palm Springs. This new suit concerns the nearby Murano Palm Springs single-family development on San Rafael that Enterprise California also was building. (See Positively Palermo's past postings for the details about other legal action regarding Enterprise's Palermo loan being in default.) The new article can be found on this link: http://www.chicagorealestatedaily.com. In the Oct. 21 article, titled "Developer hit with another lawsuit from MB Financial," Thomas A. Corfman of Crain's Chicago Business reports: 

"MB Financial has sued Chicago developer Ron Shipka Sr. again, this time to collect $2.2 million on a stalled project in Palm Springs. Combined with two cases filed in August, the Chicago-based bank is aiming to collect nearly $7 million from Mr. Shipka, president of Enterprise Cos.
The recent case is over a loan to finance a project of 57 single-family homes in the tony California city. The loan wasn't paid off when it came due in March, according to a complaint MB filed late last month in Cook County Circuit Court. Mr. Shipka is personally liable for about $2.2 million of the $8.1 million due on the loan, the bank says.
Called Murano, just nine homes have been completed in the 20-acre project, with four houses partially constructed, the Palm Springs director of planning said in an e-mail. The number of sold houses could not be determined. Mr. Shipka did not return calls requesting comment. Murano is less than a mile from an Enterprise townhouse project where MB sued Mr. Shipka in August, alleging default on another construction loan and seeking to collect $3.1 million.
In a third case, also filed in August, the bank is seeking to collect about $1.6 million in connection with a loan it says is past-due on a development site.
The bank is separately seeking a 'non-judicial foreclosure' of the Murano project, the new complaint says. The Murano loan, like the loans on the other projects, were issued by New Century Bank, a Chicago lender that regulators shut down in April and sold to MB Financial.
For the Murano loan, issued in 2007, Mr. Shipka personally guaranteed 25% of the unpaid principal and all unpaid interest and late charges, MB says. Suing to enforce personal guarantees isn't always necessary to protect a bank from a loss, but it is nonetheless an effective part of foreclosure litigation, says real estate lawyer Scott Kenig, who isn't involved in the litigation. 'It brings leverage,' says Mr. Kenig, a partner in Chicago-based Randall & Kenig LLP. 'Guarantors are usually individuals who don't want to be caught up in a lawsuit: It gets publicized, it's a mark on their credit.'


Miss Penny Lane says: Good grief!

6 comments:

Anonymous said...

wow wow. why is bruce bushore still have his office here. hasn't mb financial taken over that space, the models?

Anonymous said...

there was a moving truck by the models the other day packing up office equipment and items.

Anonymous said...

Is it bye bye Bruce?

Anonymous said...

Maybe the hoa board will follow bruce-y.

Anonymous said...

Now now, be nice.

Anonymous said...

I would not expect Enterprise or maybe even Bruce Bushore to be gone anytime soon. Enterprise looks like it is trying to work with the bank over the loans and the bank didn't sell the property oat auction on Oct. 14 at Enterprise's request. The latest lawsuit by the bank against Shipka is an attempt to up its hand in bargaining. Michael Heath of Village Property is now on the HOA board and temporarily looking after the Enterprise properties here until it is resolved.