EDGEWATER — Prolific developer MCZ Development has offered to buy the embattled, vacant and crumbling former Edgewater Medical Center site for $7.5 million, according to bankruptcy court records.
The contract for the sale would depend on a bankruptcy judge's willingness to approve it — and also waive most of the $14.1 million the county argues is owed in unpaid property taxes.
To neighbors living near the series of buildings, at 5700 N. Ashland Ave., the news of the contract, filed last week, was met with mixed feelings.
"We’re cautiously optimistic," said Maurine Berens, vice president of the West Edgewater Area Neighbors neighborhood association. "Density is still an issue for us as a neighborhood. We’re not looking forward to a 13-story building with 214 units."
Berens also said past contracts on the property hadn't held up.
"We’re not holding our breath," she said.
Berens and her neighbors have long decried that the buildings on the site were never maintained properly and were a safety hazard after closing 13 years ago.
But with MCZ's proposal, the end of an era could be near.
The contract relies on one key contingency: $14.1 million in unpaid property taxes assessed by Cook County must be reduced to less than $1 million, according to a motion filed by the estate's attorneys.
The motion stated: "If EMC cannot eliminate (or substantially reduce) the groundless taxes the County has improperly imposed upon the EMC properties, not only will EMC never realize the $7.5 million value of the proposed Agreement, but the value of this important estate asset will be eviscerated, and the multi-year efforts of the EMC Team ... as well as those of the Alderman and the City of Chicago will be for naught."
The estate's court-appointed custodian, Eugene Crane, and his legal team, claim the center had "devolved into a decrepit hulk" since it closed, according to a motion filed last month in federal bankruptcy court.
The motion requests that a judge waive the unpaid county property taxes and penalties levied against the estate. The taxes were only levied after the nonprofit Edgewater Medical Center went out of business.
Crane contends in the motion that his client's nonprofit status should exempt it from property taxes, as the hospital was. He also noted that the estate maintained medical records throughout the years as a service to the public but wasn't making any money.
On May 8, crews began working to remove and destroy the unorganized, waterlogged patient records.
The State's Attorney's Office, which represents the county in the case, didn't immediately respond to a request for comment, and a response has not been filed, according to records.
According to the motion to approve the sale to MCZ, the estate's original creditor, European-based Dexia, approves of the sale, "despite the fact that the sale will yield insufficient proceeds to satisfy its claim in full."
Waveland Partners, which was hired by the estate to market the property, received six written offers from developers to buy the land, according to the motion, and MCZ's offer was the "highest and best offer from the most-qualified buyer."
MCZ owner Michael Lerner didn't immediately respond to a request for comment.
Scott Mendeloff, attorney and spokesman for the estate, declined to comment on ongoing negotiations.
A hearing with Judge Bruce Black is scheduled for 10:30 a.m. Wednesday.
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