A Chicago real estate investment firm has acquired a struggling shopping center in the Chicago suburb of Bolingbrook, causing Starwood Capital Group to suffer a steep loss on the property.
A joint venture of M&J Wilkow and Bixby Bridge Capital purchased the debt tied to the Promenade Bolingbrook shopping center at 631 East Boughton Road and subsequently took possession of the property, Crain reported.
Although the sale price was not disclosed, a person familiar with the deal said the company paid $30 million for the $60 million loan on the mall. The buyers were then able to claim ownership of the property through a deed in lieu of foreclosure from Miami-based Starwood, which paid $81.5 million for the property in 2014.
The sale of the Promenade adds to Starwood’s financial losses; the company already lost a mall in Joliet to its lender last year and is facing foreclosure of another it owns in South Barrington. Another mall he owns in Chicago Ridge is also on the brink of distress.
In addition to Starwood, Union Bank is also taking a financial hit with the sale. The bank is also about to lose money in the same way on the Arboretum of South Barrington shopping center. Union Bank reportedly sold a $66.3 million loan tied to the property for about half the value of the mortgage.
The 779,000 square foot Promenade Mall is 89% leased with Macy’s, Bass Pro Shops and Ulta serving as anchor tenants.
Houston-based restaurant chain Star Cinema Grill also signed a lease for the newly available theater in the mall. The iPic Cinema which previously occupied the space announced its closure late last year.
“We were attracted to The Promenade Bolingbrook because of its anchor tenants and its location in this growing southwestern suburban shopping node,” said John Wiechart, senior vice president of acquisitions for M&J Wilkow, in a statement.
Bixby Bridge Capital also recently sold the former OfficeMax headquarters in Naperville for $73.3 million. He redeveloped the site into a multi-tenant office building now called the Shuman.
[CCB] —Victoria Pruitt