UPDATED: March 20 at 6:10 a.m.
The city of Quincy is asking the owner of the Newcomb Hotel to pay up or face possible foreclosure.
The city's Finance Committee directed lawyers to send a 20-day notice to pay back overdue money Quincy loaned the owner back in 2003.
The letter reportedly also asks owner Victor Horowitz improve the physical condition of the hotel.
No word yet on whether the city will move forward with foreclosure proceedings on the historic hotel if the demands are not met.
Original Story: December 1, 2011
The deal has fallen through for the Newcomb Hotel just two weeks after the City of Quincy signed off on a transfer of debt owed to the City on the property.
A new company affiliated with 3 Diamond Development, the group that wanted to work on the $15 million dollar project, was to close on the mortgage Thursday.
Newcomb Quincy LP was going to assume the debt; Victor Horowitz, the previous would-be developer, and his company Newcomb Realty LLC owe the city close to $490,000.
City Planner Chuck Bevelheimer said the investors with 3 Diamond Development wanted guarantees the company wasnâ??t comfortable signing off on.
â??They were close to getting the deal done â?¦ but they called us and told us that wasnâ??t going to happen,â?? Bevelheimer said. â??Unfortunately the guarantees the investors were putting on the developer were too stringent.â??
Bevelheimer said from the Cityâ??s perspective, they all worked together the best they could to make the renovation happen. The plan was for the Newcomb to be turned into an assisted-living facility. But the issues between the investors and developers â??fell apart and unraveled the deal.â??
He said the Economic Development Loan Committee â?? which approved the transfer of debt and gave a $500,000 loan to Horowitz eight years ago â?? would meet again shortly on what to do next.
â??We still have a mortgage thatâ??s gone unpaid that will have to be dealt with,â?? Bevelheimer added.
3 Diamond Developmentâ??s request for the quick transfer of debt was due to regulations surrounding Low Income Housing Tax Credits, which the company applied for and received.
Bevelheimer said the situation was unfortunate, and that the developers were good to work with.
â??They came forward, worked with local contractors and spent somewhere near $500,000 on this project,â?? he said, saying it is â??mind-numbing to think they walked away with that kind of money on the table.â??
He said they will have to decide on the best course of action to take next.
The news comes almost exactly nine months after another Chicago developer backed away from building The Residences at Quincy Senior, a $13 million project slated for South Eighth Street between York and Jersey.
(Original story by Jamie Busen and Bryan Nichols, WTAD News.)