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Saturday 30 August 2014

Developer Garrett Kelleher loses his luxury $8.5m Chicago mansion

John Breslin

Published 16/01/2013 | 05:00

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DEVELOPER Garrett Kelleher has lost his multimillion-dollar mansion in Chicago to foreclosure.

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The Dubliner, who once had hugely ambitious plans to build the tallest skyscraper in the western hemisphere, was forced by a court to hand over the keys to the mansion he bought for $8.5m (€6.3m) and spent millions more renovating.

It is one of the most expensive home foreclosures ever in the city, on a house on the monied Gold Coast, the most upmarket area in Chicago.

Bank of America lent a company controlled by Mr Kelleher $10.8m (€8m). It claimed to be owed, with interest, more than $12m (€8.9m) when it filed for foreclosure in 2011.

However, the bank is not taking the keys as last year it sold the debt for an undisclosed sum to a company headed by a well-known Chicago property speculator and stock trader.

Mr Kelleher will not be personally liable to pay off any difference between the loan balance – $12.8m (€9.5m) at the end of September – and the amount that Phillip Sylvester, through his venture Set Capital, paid for the property, according to documents filed in court.

The foreclosure marks the end for Mr Kelleher in the city where he started off as a house painter in the 1980s before returning in 2007 with a dream to build the 150-floor, 2,000 ft spire overlooking Lake Michigan.

As the St Patrick's Athletic owner put together his plans for the Santiago Calatrava-designed $1.2bn (€890m) structure, Mr Kelleher decided that he needed a home base.

He picked one of the most desirable and upmarket streets near Chicago's city centre, North Astor on the Gold Coast.

Work started on the Spire in 2007, helped by a loan of more than $70m (€52m) from Anglo Irish Bank.

Mr Kelleher and his company, Shelbourne, embarked on a worldwide marketing blitz, beginning in early 2008 in Dublin with a spectacular invitation-only party attended by 500 people, including special guests Liam Neeson and Natasha Richardson.

Then came the crash.

Work was effectively halted on the site by October 2008, as Shelbourne was hit with a flurry of demands for money by contractors worried that they would not get paid.

Spire

Mr Calatrava himself demanded payment of $11m for designing the structure. Those claims are still outstanding.

The Dublin developer tried to persuade a consortium of unions to invest in the stalled development but they declined.

Anglo Irish foreclosed on the site in late 2010, claiming to be owed $77m (€57m). The site is now estimated to be worth just over $16m (€11m).

According to property documents filed in Chicago, the North Astor home, which Kelleher never lived in but tried to sell for an eye watering $16m (€11.9m) before the foreclosure, has a market value of around $4.7m (€3.5m).

Irish Independent

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