Chicago Spire in Dire Straits

Lakeside tower owes architect and lender big money

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    NEWSLETTERS

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    The Spire was supposed to soar above the skyline, but right now it's just a hole in the ground.

    The planned 150-story Chicago Spire condominium tower was going to be the tallest building in the city, and the world. But now, it's just the deepest in debt.

    Bank of America Corp. has sued Shelbourne Development Group Inc., the company who is building the structure, claiming they defaulted on a loan.

    According to a lawsuit filed today in U.S. District Court in Chicago, Bank of America is seeking $4.9 million in principal, interest, and associated fees and expenses.

    Garrett Kelleher, executive chairman of Shelbourne, had taken over the project in 2006 after Christopher Carley of the Fordham Company failed to acquire sufficient financing. Kelleher announced that he would fund the project himself. Construction began in 2007 with an expected completion in 2010.

    But in 2008, Santiago Calatrava, the tower's architect, placed an $11.3 million lien on the construction site, stating that Kelleher had not yet paid him for his work.

    Construction also stopped late last year after the foundation was dug and reinforced.

    "It's on hold," the developer’s outside spokesperson, Kim Metcalfe of Weber Shandwick, said in a phone interview with Bloomberg. Shelbourne is "waiting for the economy to rebound" before proceeding, Metcalfe said.

    But while the company is "waiting," Bank of America has claimed that Shelbourne Development failed to obtain an irrevocable construction loan commitment from a lender or lending syndicate, leading the bank to declare a default.

    At this rate the "Lien-ing Tower of Chicago" will never get off the ground. Or in the ground, rather.

    Matt Bartosik, a "between blogs" blogger, knows the drill bit.