The Bank of America has initiated court proceeding against Shelbourne Development and its Irish owner Garrett Kelleher because it alleges that the development company has breached a loan agreement.
Shelbourne Development announced in 2006 that it was going to construct the world’s tallest building, The Chicago Spire. Land for the project was acquired and the ambitious plans for the Santiago-Calatrava designed Spire were unveiled to the public.
Building started in 2007, and the deal was financed in part by a $66 million loan from the Anglo Irish Bank, which has since been nationalized by the Irish government.
Shelbourne Development are adamant that the 2000-foot plus 150 storey project will be finished, but economic conditions must improve before construction continues.
Bank of America alleges that it signed an initial $3 million loan deal with Shelbourne Development in December 2006 to aid construction, and that the loan was extended to $7m in June 2007.
In 2008, both parties agreed that Shelbourne Development provide proof of the funding they had at their disposal to complete the Spire.
When the Bank of America had not received any information on that front by November 1, 2008, they alleged that the development company was in breach to the loan agreement, and that repayments have not been made on the outstanding amount, which the Bank says is $4.9m.