Bank Loses Money on John Salmons's House

In late 2009, the builder of this new five-bedroom Glencoe home, which had been on the market for $3.295 million, opted to rent it for $7,000 a month to John Salmons of the Chicago Bulls. At the time, it looked like a smart tactic since two other new homes in the neighborhood had just gone as short sales (meaning the bank agreed to sell the properties for less than what was due on their mortgages).

But Salmons left Chicago to play for the Milwaukee Bucks in early 2010, and in August, the residence was still unsold. Ownership was transferred from the builder to the lender, PrivateBank, which put the house back on the market in October at $2.7 million. The French-style home, which stands on a little more than half an acre, with a view across the street to a golf course, finally sold in late December for $1.95 million.

That’s just $450,000 more than the $1.5 million that the original developer paid for the lot in 2006. A conservative estimate of construction costs—$200 per square foot on the 7,000-square-foot home—comes to $1.4 million, which suggests that the house sold for almost $1 million less than the combined investment of roughly $2.9 million in land and construction. The buyers are not identified in public records, and PrivateBank officers could not be reached for comment.



(chicagomag.com)