Troubled Arboretum property could have new owners soon

Michael Jaffe, developer of the Arboretum of South Barrington, said Wednesday that a new owner could take control of the long-troubled shopping mall property within the next 60 days.

And that new owner could be him.

Although the Jaffe Companies of Northbrook, along with partners RREEF, an asset management firm, and CalPERS, the California public employees retirement system, are named in a $91 million foreclosure lawsuit, Jaffe said he’d like to be among the bidders on the outstanding note for the property. Jaffe said he is seeking new partners to help in the endeavor.

“This suit is just a legal formality to assure clear title of the property,” Jaffe said.

Germany-based EuroHypo A.G. filed the lawsuit in late February in Cook County Circuit Court against Jaffe and his partners for nonpayment on the shopping mall property at routes 59 and 72. A EuroHypo spokesman was not immediately available for comment.

The mall opened in September 2008, just as Lehman Brothers turned Wall Street upside down and the economy spiraled downward. Then the three-year construction loan wasn’t paid by October 2010 and went into default.

“We do not have an adversarial relationship with the bank,” Jaffe said.

Jaffe said the mall is well leased, but some shoppers say there are some empty storefronts.

“From a tenant’s standpoint and from a public standpoint, all of this is going on behind the scenes. It won’t change what people will see there,” Jaffe said.

The lifestyle mall has about 50 stores, including L.L. Bean, Toms-Price Home Furnishings, Cooper’s Hawk Winery & Restaurant, Anna Shea Chocolates & Lounge and Pinstripes Bowling/Bocce/Bistro.

The foreclosure process on the property is mostly invisible to customers, said Pinstripes CEO Dale Schwartz.

“Generally, it’s business as usual,” Schwartz said.

A manager at Anna Shea and the owner of Cooper’s Hawk were not immediately available for comment.

Jaffe has been involved in several other projects, including Geneva Commons, a lifestyle center in Geneva, Ill; The Arboretum Shopping Center in Austin, Texas; and Huebner Oaks Center, a lifestyle center in San Antonio, Texas.