It seemed all over, a Dublin developer’s dream of building the twisting, soaring Chicago Spire, planned to be the tallest building in the western hemisphere.
But Garrett Kelleher is back, fighting to keep the dream alive and begin again to build on what has been since 2008 nothing more than a multi-million dollar 2.2-acre hole in the ground.
His plans are likely not to be as ambitious as before, but Kelleher has struck a deal with a development company that would allow him to pay off debtors and at least hold on to the site.
Details of the plan to pay off some $120m (€97m) in debt have emerged as an involuntary bankruptcy case continues in Chicago.
Kelleher’s Spire development company, Shelbourne North Water Street, was forced into bankruptcy proceedings late last year by creditors, including Related Cos, owed $80m after buying from Nama the original Anglo Irish debt.
New York-based Related bought the debt at an unknown discount. A lawyer for Related made clear it either wants its money or to take over the site and build.
But the firm, one of the busiest developers in Chicago, has been scathing about the proposed deal between Shelbourne and Atlas Apartment Holdings, which has stepped forward with a promise of $135m to clear the debts.
Atlas has admitted other unnamed third parties will come up with the bulk of the cash and, further, under the deal it has time to secure funding and carry out due diligence.
In a court filing objecting to the deal, Related described the funding proposal as “illusory and a sham”, a one-sided deal in Atlas’s favour with no teeth to force the company to deliver the money.
It “simply gives Atlas a 100% free option and improper control of this case in return for a vague, uncommitted, unfunded and discretionary agreement by Atlas to spend up to five months doing due diligence on a dormant, single asset real estate project.”
The plan is just a way of delaying the case and locking out Related and other creditors from the bankruptcy process, the company added.
Atlas rejected these claims, citing its track record, including a recent $250m development in Texas.
Kelleher has to file a reorganisation plan by March 10, to be followed by a two-day trial, after which the judge overseeing the bankruptcy case will decide whether to sign off on the package.
This may be Kelleher’s last chance to remain involved with the site by Lake Michigan, which he bought more than eight years ago with a loan from Anglo Irish Bank.
© Irish Examiner Ltd. All rights reserved