Barry Mandel, the developer who plans to build a $34 million mixed-use development in the Shorewood, is capable of meeting any annual shortfall payments on the project's annual loan payments if needed, according to a consultant hired by the village.
Michael Harrigan, the village's financial adviser with Ehlers and Associates, told the Community Development Authority Wednesday that he has reviewed Mandel's personal financial statements and is confident that he is able to meet the financial obligation, if needed during the life of the project.
The village is lending Mandel $3.54 million for the project. The loan is expected to be paid back with revenue generated through rent.
CDA members asked Harrigan how common this type of due diligence is when dealing with a developer.
"I think it's beginning to be a little more common," Harrigan said. "Personal guarantees can be valuable only to the extent that the guarantor has the wherewithal. Having the ability to look at, I think is an important part of the diligence."
Mandel plans to build a six-story building that will include retail space for Walgreens, 84 apartment units and two parking structures. The village has created its fourth special tax district to help fund the Lighthorse 4041 project.
The CDA on Wednesday also approved some revisions in the developer's agreement for the project.
Harrigan gave a detailed report on Mandel's personal financial statements to Bruce Block, the village special counsel on the project. Harrigan has also reviewed a detailed summary of Mandel's personal financial records with Village Manager Chris Swartz, CDA chairman Pete Petrie and Village President Guy Johnson.
Mandel's financial statements were provided to Harrigan by Richard Pavela, the chief financial officer of Mandel's firm. Harrigan also met with Pavela and had a couple of phone calls with him regarding the financial statements.
"They were very corporative. I got all of the information that I had asked for and the detail that I asked for," Harrigan said.
Harrigan indicated the inquiry does not guarantee that Mandel's financial position will not change in the future.
"Basically, we are taking a snapshot of what is there today and, as we know those things have the ability to change," Harrigan told the panel.