The Forest Creek condominium development, in foreclosure for the past year, has been sold. The new owners, who have experience in rehabbing abandoned and foreclosed properties, will begin completing exterior and interior work in the next few weeks and will start marketing the 18 residential units by March.
On Dec. 17, a Cook County judge entered a judgment of foreclosure against Bass Builders, transferring ownership to Private Bank and Trust Company, which was owed over $4 million in January 2009 when the builder defaulted, according to court records.
That set the scene for the sale of the building to Wilmette-based Jenny Builders on Dec. 30, 2009. The sale price was $1,275,000, according to Art Gurevich, vice president of Jenny Builders.
The development is located at 3627-31 Forest Ave. in Brookfield.
Gurevich and his business partner, Mark Boldun, met with village officials Monday to discuss both the company’s plans for the development and the village’s expectations. While the building has been boarded up since August and court documents stated that the property had myriad code and water damage issues, Gurevich said that the condition of the property is not a major stumbling block.
“It’s not something earth-shattering,” Gurevich said. “We’ve built similar buildings, using similar construction methods. We plan on working closely with village officials, the building department and neighbors.”
Boldun said that Jenny Builders will quickly complete the two model units that were largely built out before foreclosure proceedings began and then work to ready another four to six of the three-story, townhome-style units for sale.
As those units sale, the company will build out other units and market them for sale.
“If there are buyers, we can realistically finish the project in a year,” Boldun said.
Gurevich pointed to a recent project that he and Boldun completed at 3815 N. Kedzie in Chicago. The new commercial/residential building there had also fallen into foreclosure. They bought the property, finished work within a month and had contracts on six units within three weeks.
Their method is to buy distressed properties in areas where there is still an existing real estate market, finish the work and then sell the units “at lower prices than what’s around. And we still have a very nice product, better than what’s usually expected.”
Gurevich said that list prices for the condo units at Forest Creek have not been finalized.
Gurevich and Boldun have partnered on real estate developments for the past decade, just a few years after Boldun immigrated to the United States from the Ukraine, where he was vice president of a state-owned building company, Boldun said. Gurevich, originally from Belarus, emigrated from the former Soviet Union in 1979.
In addition to their work on Chicago’s North Side, the pair has developed condominium buildings in the Kenwood neighborhood of Chicago, winning accolades in 2003 from the Chicago Commission on Landmarks for new construction in that neighborhood.
Keith Sbiral, director of Brookfield’s Department of Building and Planning, said that Jenny Builders must meet the same building standards required of Bass Builders and must fix any aspects of the development that are out of compliance with code.
“The standard isn’t being lowered because of the crappy economy,” Sbiral said. “This needs to be a full-blown development. We didn’t pull any punches with them in what we require.”
All of the exterior work – fixing cracked concrete, putting retaining walls around pillars, finishing driveways – must be completed before the village will give a certificate of occupancy for any unit, Sbiral said.
“They’re dedicated to doing this,” Sbiral said.
Jenny Builders’ purchase of the Forest Creek development is the first positive news for the property since Bass Builders received zoning variances to construct the 18-unit development in 2006, part of which sits in the Salt Creek “100 year” flood plain.
The development received vociferous opposition from neighbors during the village approval process. Construction didn’t start until 2007 and was stopped for two months that summer over permitting issues.
When construction was largely completed in 2008, the real estate market had already begun to tank and the development suffered the effects of a “100-year flood” that September, when Salt Creek overflowed its banks and inundated the development’s central courtyard.
Bass Builders purchased two lots in 2006 for the development, paying just under $1.2 million for the property. They secured a $5.35 million construction loan from Private Bank in March 2007, but owed $4 million in January 2009 when the bank began foreclosure proceedings.