A photograph of the inside of Maywood Market when it was opened. | Benjamin Chernivsky/Chicago Tribune
Thursday, April 14, 2016 || By Michael Romain || Update: 7:26 PM
When it opened six years ago, Maywood Market was touted as the village’s “first full-service grocery store in more than 20 years” and former mayor Henderson Yarbrough noted that it was going to be the “catalyst to future economic development,” according to a statement released by the village at the time and subsequently included in a 2011 article by the Better Government Association.
Today, the site of the grocery store, which records indicate cost around $3.25 million in taxpayer money to develop, sits empty. And, far from catalyzing economic growth, the store — which closed around a year after it opened in 2010 — has turned out to be the gift that keeps on taking.
In 2010, the developer of Maywood Market needed $250,000 to “float cash flow for operations,” according to an August 2015 memo drafted by village attorney Michael Jurusik. But Seaway Bank, formerly First Suburban National Bank, wouldn’t loan the money unless the Village of Maywood essentially co-signed for the loan, which it agreed to do.
When the developer defaulted on the $250,000 loan in 2011, Seaway decided to pursue the party in the best position to pay the loan back — the village.
“That promissory note of $250,000 was not paid,” said Jurusik at an April 13 board meeting during which the repayment was discussed. “Interest has been accruing since 2010.”
The amount of the principal, the interest, late penalties and attorney’s fees totals more than $300,000, records indicate. Jurusik recommended that the board members vote to pay the settlement, since if “you litigated it you’d lose.”
Last year, Jurusik said, Seaway demanded that the village pay around $311,000 — an amount that included the roughly $250,000 outstanding principal and roughly $61,000 in accrued interest — in full and immediately.
Seaway also filed a lawsuit against the Maywood Market developers, listed as George Basdekis, Bob Haralamopoulos and Jim Stathopoulos. Jurusik said the bank hasn’t had any success in collecting money from the owners because when the grocery store failed, the owners didn’t have many assets to pursue.
At Wednesday’s board meeting, Jurusik touted his ability to negotiate the money owed by the village down to $300,000 and was also able to talk Seaway into agreeing to a 30-month payment arrangement whereby the village would pay down $10,000 a month without the accrual of new late fines, interest and additional fees.
He also noted that, in the unlikely event that the developers do repay Seaway, then the bank will provide the village “a credit equal to the amount of the funds” recovered, according to the settlement agreement.
Jurusik said the village needs to pay down the money if it’s to make the site attractive to the several prospective developers that have been recently eyeing the site. He also noted that the settlement agreement is a culmination of the village’s years-long attempt to secure the site from its previous owner in order to get it back on the tax rolls. When the grocery store went out of business, the building’s ownership, and all of the accompanying liabilities, virtually reverted back to the village.
In addition to the $300,000 settlement payment, the village would also need to pay the costs of extensive electrical repairs on the vacant building before it can turn it over to prospective developers.
Village officials said that, several years ago, the building was vandalized and more than $200,000 worth of copper wiring was stolen from inside of it. The village has also put thousands of dollars into policing services, materials and lighting to secure the boarded-up building, which has become a constant ache for some residents and board members.
“We’re talking about over $300,000,” said Trustee Isiah Brandon. “That’s more streets that could’ve been repaired, more folks who could’ve been hired. I guess the village co-signed … to support this particular business, which I believe was a huge mistake as well.”
“Where does it end? Where does it end? It ends in our pockets,” said Lucille Redmond, a resident who has been outspoken against the Maywood Market development and the village’s handling of the building since the grocery store went out of business.
“We are steady losing money on this Maywood Market that is sitting there being vandalized and just deteriorating,” she said at the April 13 meeting. “Taxpayer dollars are going to waste.”
Redmond brought up the development’s ties to former mayor Yarbrough, questioning whether or not Yarbrough’s sister-in-law, Sharlene Estelle, pocketed any money after the vandalism. When it opened, Estelle’s State Farm insurance agency was hired to provide the insurance policy for the grocery store.
According to the BGA article Redmond cited in her comments, after the store closed it would have been likely that Estelle would “lose the Maywood Market insurance policy as the coverage shifts to the village government’s existing policy,” according to village officials BGA reporters interviewed at the time.
At Wednesday’s meeting, Trustee Michael Rogers noted that the building is currently insured, but that a claim may not have been filed after the act of vandalism in a timely manner for a policy to cover the stolen wiring. The board didn’t indicate which firm the village is currently contracting with to provide insurance.
“The building is still insured. It was insured as far as I know throughout the course of time, but recently … whenever the electrical things were taken was years ago,” he said. “You have to file the claim within a reasonable amount of time usually … we really wouldn’t be able to replace that wiring off of a claim now because that was so long ago.”
The board voted 4 to 2 to consider approving the $300,000 settlement payment at the next regular board meeting on April 19. Trustee Isiah Brandon and Mayor Edwenna Perkins both voted against the motion. Trustee Yarbrough was absent.
If the board approves the payment, part of the money will come out of the Madison Street TIF fund, Jurusik said. VFP
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