Headlines: Leafs Ice Centre in Foreclosure

Stop me if you have heard this one before:

A Chicago area youth hockey club borrows $20 million in tax exempt bonds to build a three pad state-of-the-art temple to hockey. At first, things are great. Your rivals schlep an hour down the Interstate and are greeted with your logo on a shiny new building. They come in the front door to a spacious lobby with every amenity you can imagine. The players marvel at the clear glass and white boards on their way to the roomy locker rooms. Following the game, the visiting families leave green with envy.

A few years go by, and the first interest payment come due. Ooops, not enough money in the kitty to pay THAT bill. No worries, we will pick up the next one!

Except that payment gets missed too. Which makes the bond holders really angry. So angry that they drag you into foreclosure court.

Damn near exactly two years ago I wrote this post on the Huskies Hockey Club and the International Ice Centre going through foreclosure. Guess what?  The Leafs Hockey Club and the Leafs Ice Centre just joined them.

From Crain's Chicago Business:

Suburban ice rink finances are slip-sliding away

The article leads off with the obvious connection:

When the Leafs Hockey Club needed a loan to finance a massive three-rink ice complex in West Dundee, it got a deal that was hard to beat: nearly $20 million in tax-exempt bonds with no equity at risk.

The 2007 deal wasn't so sweet for investors. Last month, a trustee working on their behalf filed to foreclose on the state-of-the-art hockey palace, alleging that bondholders never received a semiannual interest payment due in September, the third missed payment in three years.

The story may sound familiar to the Chicago hockey set. Two years ago, the same thing happened to the International Ice Centre, a three-rink facility in Romeoville built during the boom that also was financed by tax-exempt bonds and backed by a hockey club.

The outcome: A Canadian company acquired the property out of foreclosure for $3.7 million, a fraction of the $20.7 million owed on it.

A preliminary hearing is scheduled for February 15 at the Kane County Courthouse. Does anyone have a spare $3.7 million lying around? I hear you can get a deal on a slightly used hockey rink ... just make sure you don't spell "ice center" the fancy way with an R E on the end.


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