LOGAN SQUARE — A court-appointed receiver has assumed control of the dilapidated Congress Theater, another sign developer Michael Moyer’s multi-million-dollar redevelopment project might not be moving forward anytime soon — if at all.
The receivership is the result of the $24 million foreclosure lawsuit Moyer was hit with this fall.
Los Angeles-based lender AEG Worldwide sued Moyer for allegedly defaulting on $14 million in loans on the theater at 2135 N. Milwaukee Ave. more than four years ago.
Over time, the loans resulted in another $10 million in fees and interest, bringing the total amount Moyer owes up to $24 million, the lender alleges. The lawsuit was first reported by Crain’s.
Around the same time the lawsuit became public, a judge appointed a receiver to “care for” the 1920s theater, which has fallen into disrepair, said Ald. Daniel La Spata (1st), whose ward includes the Congress. Receivers are appointed to protect a property during a pending lawsuit.
“My office and I are working with the receiver to understand the scope of repairs they can make on the theater, and they have outlined a plan for securing the building and ensuring the safety of adjacent neighbors and passersby,” La Spata said in a statement.
La Spata said he has met with the receiver and they “share the same goals of securing the theater and making sure that it is as safe as possible for our neighbors.”
“I am very pleased with their responsiveness and goals for keeping the theater safe and secure,” the alderman said.
What happens next is unclear. Multiple attempts to reach Moyer were unsuccessful. Mark Silverman, an attorney for AEG Worldwide, declined to comment on the lawsuit or the receivership.
Asked if Moyer’s project is dead given the developer’s legal and financial troubles, La Spata declined to comment, citing the ongoing lawsuit.
Peter Strazzabosco, spokesman for the city’s Planning and Development Department, said the city is taking offers from other developers.
The department “will continue to respond to market interest in the property and support viable efforts to reopen the theater and its adjacent retail and residential spaces,” Strazzabosco said in a statement.
Strazzabosco also said while Moyer received city approval to redevelop the old movie palace, his formal redevelopment agreement with the city — the very last step in a lengthy process — never closed.
Because of that, the $9.7 million in Tax Increment Finance dollars the city awarded the project in 2018 was never issued to Moyer, Strazzabosco said.
‘There Are Other Options For The Property’
Locals have long been anxious to see the Congress Theater overhauled.
In fact, it’s one of the most-asked about development projects in the 1st Ward, said La Spata, who took office in May 2019.
The historic theater has sat vacant since the city ordered it closed in 2013 following a string of code violations.
The closure also came after a series of crimes that occurred in and around the theater during shows, including the rape of a 14-year-old suburban girl. As a result, the city banned electronic dance music — the theater’s former music genre of choice — for all current and future owners.
Moyer’s journey to redevelop the Congress started in 2015, when he bought the theater for $16 million with the goal of bringing it back to its former glory. The developer has experience overhauling historic theaters; he redeveloped the Cadillac Palace Theatre and Hotel Allegro in the late 1990s.
In 2018, Moyer received multi-layered city approval to overhaul the Congress to the tune of $69 million. His plans called for a complete restoration of the theater; construction of a 30-room hotel, 14 affordable apartments and 16,000 square feet of retail space in the surrounding 160,000-square-foot theater building; as well as the construction of a 72-unit residential building next door.
But Moyer hasn’t made any noticeable progress on the Congress since then.
Because of this, neighbors and elected officials have questioned if the project is actually moving forward. La Spata said he and his staff have not been able to set up a meeting with Moyer despite repeated attempts.
In the meantime, the condition of the theater has only deteriorated more, La Spata said.
Now, with the foreclosure lawsuit, the receivership and the economic crisis brought on by the coronavirus pandemic, neighbors are even more worried the Congress will languish.
“We all had a tremendous amount of hope when Michael Moyer’s plan came along that we’d see a rejuvenated Congress Theater,” said Andrew Schneider, president of Logan Square Preservation. “It’s disturbing that the finances of Michael Moyer seem to be in peril and the building sits vacant.”
Schneider said he would support La Spata and the city cutting ties with Moyer if it meant part of the site could be redeveloped. The apartments in the Congress building have been empty since 2015, when a judge evicted the 19 remaining tenants in the lead-up to Moyer taking ownership.
“There’s no reason the apartment component couldn’t be rehabbed and tenanted,” Schneider said. “There are other options for the property.”
Built in 1926 as an ornate movie palace, the Congress Theater was added to the National Register of Historic Places in 2017. In its heyday, everyone from Chuck Berry to Jerry Lee Lewis graced its stage.
This is not the first time the Congress has been tangled up in a foreclosure lawsuit. Former owner Erineo “Eddie” Carranza was threatened with foreclosure in 2012 after defaulting on a $4 million loan.
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