FYI Craig -
The new 5-unit townhouse/penthouse development at Estes and the Metra viaduct is now in foreclosure:
2007CH-30168 Oxford Bank & Trv Destefano Development Inc, et al - Mortgage - $2,289,561 - 1802-06 W Estes,Chicago - DLA Piper US atty.
Originally a Camelot Realty project, Rich Aronson presented the original proposal to the community at Paschen Park. Construction was delayed two summers ago; I believe due to a cash flow problem. Construction resumed last year under new management.
The four ground-level, two-story townhouses were listed at $529K and the penthouse, while not specifically priced, was somewhere north of $700K.
While never conforming well to the architectural renderings originally presented, the look of the place was pretty much ruined when Peoples Gas installed a massive multi-unit gas meter assembly right on the front wall of the place. What were they thinking? Probably no one on site to tell them to hook it up on the east wall, out of view, where the garage entrances are. It just goes to show that no one had their eyes on what was going on there.
Just thought you'd like to know.
Feel free to post, share, etc. Thanks.
Estes Watcher
12 comments:
I think it's an ugly institutional looking building, which doesn't help. A large shrub (planted not too close to the building) would solve the unsightly people's gas issue.
Har. Now we see Aronson and other developers get their just desserts for their greed and stupidity.
One developer here in Chicago, who was developing a 130-unit mixed-use condo-commercial development on the banks of the Chicago River in Sauganash, has been foreclosed on the $14 million construction loan that he had PERSONALLY guaranteed.
And Chicago has more adjustable loans than any other city, even Los Angeles, even though the Loan-to-income ratios were much worse there. They're still pretty bad here, what with people making $40K a year buying $200K condos with little or no down, like idiots.
Why did so many developers across the nation not see that they were overbuilding as of 2004? Can they not count? Do the wonks they contract to work up an analysis of market conditions not see that things were getting a little, uh, hysterical in the RE market as of 2003 and that there are only so many people who can afford places that cost $400K, let alone $700K? Did they not see that $300K is a stretch for most middle income families and that only all the 2/28 mortgages made it possible for so many dummies to buy so much overpriced housing?
Have you read about all the strange fires in empty new subdivision houses in Naperville and Olympia Fields? There are empty, rapidly deteriorating new subdivisions all over the country, being taken apart by looters for the copper and aluminum.
This is the payback for developers who have been building for the top 1.5%of all earners. It is also the payback for lenders AND borrowers who thought they could find a way to make it possible for folks making $45K a year to afford $250K places, and folks making maybe $100K to afford $700K.
The count of defunct lenders is up to 164. That's last count. I'll check with my mortgage broker buddy, who's fending off regulators, to see if there are more.
I'm seeing some givebacks in prices, like about 10% in some cases, but we are nowhere near capitulation. I have been tracking about 40 different condos in my price bracket in Edgewater and RP, as well as Lakeview, and there is an excellent 2bed rehab, very beautiful, on Surf in Lakeview that has sat on the market at $239K (not a typo)for over 6 months. My pet places in Edgewater have been on the market going on 8 months. I'm waiting for further drops in prices, which I have no doubt will come.
Capitulation will come next year, I think, after the trillion $$ worth of adjustable mortgages due to reset in the next year have done that.
THEN we will see lots and lots of really affordable housing.
It will be fun.
Just hope I'm still employed, because this bursting credit bubble is every bit as bad as the one of the 1920s.
Too bad the housing had to get so insanely overpriced to begin with and that so many dummies borrowed so far over their heads. Even if these morons don't get bailed out, we will all have to pay for this.
The only silver lining I can see is that a large number of really bad buildings in Rogers Park and Edgewater got rehabbed. However,that gain is offset by the number of really beautiful old places that were utterly trashed by bad, tasteless rehabs.
SPEAKING OF UGLY BUILDINGS-
LOOK AT THE CONDO GOING UP ON THE NORTH EAST CORNER OF MORSE AND GREENVIEW-
THE MOST STERILE LOOKING BUILDING HAVE SEEN GOING UP IN A LONG TIME-
BET IT WILL LAY EGGS FOR A LONG TIME-
North Coast,
I'm all for people who deserve it to get their come-uppin's, but you seem to be positively gleeful over the fact that MANY people will loose much, if not everything.
Many people just didn't understand finances and were taken advantage of by lenders looking to make money (as loan officers and the like make more for selling more loans).
It just seems to be a bit sadistic of you to be basking in other people's mistakes.
Yes, people like developers and people-in-the-know who were trying to flip condos took a calculated risk and deserve the crash, just as they deserved the rewards when things were good. But, again, many not in-the-know, are now in trouble because of their ignorance and another's greed. I say it's bad kharma to enjoy someone else's mistakes.
Dr O, I confess to feeling a touch of Schadenfruede, or joy in the misfortunes of others.
Let me tell you why.
Let me tell you that when I managed to totally bury myself financially as a result of business mis-steps, there was no shortage of people dancing on my grave.
Moreover,I am a very Bitter Renter who gets very tired of the smugness of "homeowners" who indulge in owner vs renter snobbery and who crowed about how stupid and improvident we renters were by not being able to buy at these insane multiples. I was trying to gather a decent downpayment and watching the prices ratchet from just slightly overpriced to completely out of my range for condos precisely comparable to my rental, and have had to endure the bragging and crowing of these "buyers" and flippers who bragged on this blog and others about how they could buy $300K places on $65K a year - a lunatic ratio-because of their superior moxie and skills. For 5 years I heard nothing but how stupid I was because I thought things were overpriced and that there was something wrong with me because I didn't take out some wonderland mortgage and jump into to the pool with all the other lemmings.
I could have done that easily. I have 4 buddies and a brokerage client who were in the mortgage business (most of them are gone now) who offered me lots of interesting mortgage products that would have enabled me to buy a place for 4, 5, and even 6X my income for a lower payment (to start!) then my rent.
You KNOW the place will appreciate 20% and you can refinance, they all said.
Do you guarantee that, I asked.
One man tried to sell me one of the wretched studio units in Uptown he was speculating in and not only recommended I take out an IO loan but lied flagrantly about the condition of the building and upcoming special assessment. When the market started unwinding and left this guy stuck with these overpriced little dumps, he howled to the heavens about how he was defrauded.
So of course I'm gleeful, mainly because the prices are beginning to drop enough so that I just might be able to afford a decent one bed condo comparable to my rental at a price reasonably in parity with the rent I pay and to my income, with an HONEST FIXED RATE MORTGAGE at a sane multiple of my income, like 2.5X my salary, without city assistance. I'm seeing half-sane prices for the first time in years.
But NOW these very same braggarts want to be bailed out of the misery they made themselves, and they want us renters and sane buyers to help them out, by a tax funded bailout, or other public assistance.
All I can say is that I'm glad it's over and we all would have better off if it had never started. You almost can't count the new and rehabbed buildings with really severe construction problems, or the conversions where the legal work wasn't done properly, or the tenants who were forced out of places where they weren't given proper notice, or the elders forced out of homes due to taxes ratcheting upwards rapidly by the fake "wealth effect" of the rapid runup in prices.
I feel genuinely sorry for the naive and uneducated lower-income people who were truly defrauded, but these people are really the minority among sqeezed borrowers. Most of the folks staring at foreclosure now are the greedy and self-indulgent members of the middle class, and they are often well-educated and have relatively high incomes. They are just 'victims' of their own greed, delusions of grandeur, and sense of entitlement.
" ... the look of the place was pretty much ruined when Peoples Gas installed a massive multi-unit gas meter assembly right on the front wall of the place."
These are the favorite lawn ornaments of Chicago's concrete block luxury condo developers. Get used to them. We will be seeing more & more of them.
Chicago's developers in their quest for extracting the maximum dollars from their projects build their footprints to the very edges of the side and rear lot lines, literally leaving no room for the utilities companies.
You can see these eyesores on many new construction projects. A prominent example is the NE corner of Touhy & Ridge & Rogers.
NC,
So, you did the wise thing by not getting caught up in the feeding frenzy, and decided to be fiscally conservative...bravo. My wife and I bought a 145K condo on an income of 100K, as I am of the same mind. This is the same difference that separates investors like Warren Buffett from the typical stock investor.
I also agree that the brokers, speculators and buyers should not be bailed out any more than I believe they should share their profits if those purchases DID go up 20%. You take the chance...reap the profits or debts. If that was the way things would be done maybe people would think more before getting caught up in the heat of the moment.
Still no reason for anyone to gloat about being right about anothers mistakes.
Dr O, you are correct in that Schadenfruede per se is not good for the human spirit, even though it sometimes FEELS good.
What I am really gloating at is the chance to get something nice and "affordable" at last, in my price range, without having to get city assistance, something I tend to scorn.
Just a few more months....as a trillion bucks or so of 2/28 and IO mortgages reset.
What beats me is how some shmo can have her place listed at a particular price with no offers for 8 months on end and yet have the cheek to refer to it as "under market".
Excuse me, but the 'market' price is what someone is willing and able to pay, and if your joint has been languishing on the market for that long with no takers, that should be a clue that it is 'overmarket'.
I will be very glad to see condos and houses along the North Coast affordable to their probable market.
I have to agree with a lot of what The North Coast is saying.
I don't have sympathy for a condo developers woes when there are low-income and working-class individuals and families trying to find places to live that their salaries can afford.
Do some homework people. The FACT is you can't just put gas meters any place you like.
Not that I think this looks good but.......how bout a couple shrubs? ;-)
It is good that RP has many large turn-of-the-century apt. buildings that are being preserved (at least the exterior). In Lakeview and other pricey areas many 2-, 3-flat and homes have been knocked down and replaced with new condos. Entire streets have been redeveloped with "simple-minded" architectural design and third world cinder block construction.
Crain's lists & highlights the 1804 Estes foreclosure
Foreclosures
Oxford Bank & Trust has filed a foreclosure lawsuit against DeStefano Development Inc. in connection with a small condominium project at 1802-06 W. Estes Ave. in Rogers Park. The Oak Brook-based bank is seeking about $2.4 million.
Public Records Data:Foreclosures
Posted Saturday, Nov. 3
COOK COUNTY
10/19/07 07CH0030168 Oxford Bank & Trust vs. Gary Destefano, 1804 W Estes Ave, Chicago, Commercial Property, $2,289,561
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