Bank sues River Park Place owners in Elgin over loan default

PNC Bank recently filed a complaint against River Park Place, claiming the Elgin company defaulted on a 2005 loan used to develop townhouses in downtown Elgin.

David Plote, Daniel Plote and Kurt Kresmery own River Park Place in a joint venture between their respective businesses, Par Development Inc., Plote Construction Inc., and REPCO.

According to the complaint, PNC Bank's predecessors lent $9 million to River Park Place in September 2005. The bank, which is now in control of the loan, claimed River Park Place did not make a principal reduction payment of $325,000 by Dec. 30, 2010, or pay off the matured loan, which was due Jan. 15.

PNC filed the complaint in U.S. District Court Jan. 18.

Fred Solomon, PNC Bank corporate spokesman, said the bank does not comment on pending litigation.

Crowley and Lamb P.C., the law firm representing River Park Place has the same general policy.

A groundbreaking ceremony for River Park Place took place in April 2004, when the city hailed the development as key to Elgin's revitalization. The original plan was to build 116 townhouses and 66 condominiums, but the project has not moved beyond the townhouse construction.

The City of Elgin gave River Park Place the land needed for the development, which the city owned and had been maintaining, as part of an incentive agreement amounting to about $4 million.

According to Bill Cogley, Elgin's corporation counsel, River Park Place reconveyed the land for the condominiums back to the city after an amendment to the development agreement was approved in December 2010.

Cogley said if the company is able to market the condos in the meantime, the city will likely give the land back to them.

Neither Kresmery nor Daniel Plote returned multiple phone calls for comment.

Cogley said the relationship between River Park Place and the city is unharmed, regardless of the lawsuit.

“As far as the city, the development agreement with the developer has been completed,” Cogley said.

Though some of the homes are still empty, construction finished successfully, which is all the city asked for.

As of Jan. 13, PNC Bank claims Park River Place owes almost $3.1 million for the loan plus default interest, late charges, attorney's fees and other applicable charges that continue to accrue.