Stalking Horse Bidder For The Clare
March 15, 2012
March 15, 2012. The saga continues for The Clare at Water Tower, the troubled CCRC located in downtown Chicago that never got off the ground when it opened...
during the financial crisis. Saddled with $229 million of debt and occupancy of just about 33%, it looked as if the stalking horse bid would come in between $40 million at the low end and $55 million to $60 million at the very high end. That was until the bidders started looking under the covers and realized it was a lot more complicated than they had thought. Only five of the initial 107 potential bidders ended up touring the property (at least officially) and meeting with management. The two major complications were the Residency Agreements and the lease for the land that the 53-story tower sits on, and only David Reis and his Senior Care Development (SCD) expressed an interest in trying to negotiate modifications to both, which seemed to be a necessary precondition to get the sale process moving along. As a result, SCD’s affiliate, Chicago Senior Care, LLC, became the stalking horse bidder with a reduced bid of $29.5 million, reflecting the risks for a new owner that others may not have realized when they first entered the fray. We had heard that Mr. Reis dropped out of the process when the bidding reached those earlier lofty levels, but was invited back when the other bidders began to realize what he apparently already knew. Bids are due by April 10, and if anyone tops the stalking horse bid, minus the break-up fee, an auction will take place on April 12.