Mandarin Oriental faces financial difficulty
The Mandarin Oriental hotel planned for Chicago could become a thing of the past if the developers are unable to pay back $3 million in past due bills.
Developers have already signed contracts with buyers for almost 60 percent of the planned condominiums and over 50 percent of the hotel condo units.
However, when the architect for the project, Solomon Cordwell Buenz & Associates, filed a lien for $2.5 million in unpaid bills, many industry experts began to question the future of one of the premier new condo developments in the city. Another lien was filed by a contractor working on sewage lines for $550,000 for past due bills.
Groundbreaking on the project has already been pushed back from the planned August start. Developers welcomed the news last month that iStar Financial Inc. agreed to extend financing on the project until January 15.
The downturn in the real estate market around the country and a marked increase in foreclosures have led to a credit crunch in the industry. Many projects that were viable just two years ago are now unable to obtain financing from banks.
According to the developer, all past due bills will be paid back this month. The Mandarin Oriental will offer some of the most luxurious Chicago Condos on the market.
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