Old Second National Bank Files Chicago Foreclosure Lawsuit
The bank is seeking to foreclose on a River North retail building after an alleged nine million dollar loan default.
Updated on Oct. 29, 2026 in Commercial
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Old Second National Bank has filed a foreclosure lawsuit in Cook County Circuit Court against a retail building at 400 North State Street. The lender alleges the borrower defaulted on a loan totaling approximately $9 million.
Why it matters
The legal action highlights ongoing debt challenges in Chicago's commercial real estate market. The bank is specifically seeking $2.9 million from investor Marc Bushala based on a signed personal guarantee.
The foreclosure involves a $9 million loan balance as of October 21, 2026. The property at 400 North State Street previously received a $3 million permit for restaurant conversion.
The players
Old Second National Bank
An Aurora-based financial institution that initiated the foreclosure proceedings against the River North retail property.
Marc Bushala
An investor and manager with Phoenix Group Management who is named in the lawsuit and signed a $2.9 million personal guarantee.
Dough Bros
A pizza establishment currently operating as a tenant within the retail space at 400 North State Street.
The details
The lawsuit names several entities including Great Street LLC, MAB Capital Management, and WFB Gift, alongside Marc Bushala who signed for the borrower through Phoenix Group Management. Current tenants at the property include Dough Bros pizza and Ghost LLC, and the structure was last renovated in the 1980s.
Timeline
The building was last renovated during the 1980s.
Marc Bushala sold buildings at 400 and 401 North Morgan Street in 2020.
The total debt owed reached approximately $9 million on October 21, 2026.
The bank filed the foreclosure complaint on October 26, 2026.
Culture Shift
The current litigation marks a stark shift from the 2020 sale of Fulton Market buildings by Marc Bushala, where his portfolio previously achieved a $31.7 million exit. This development highlights a broader cycle of commercial debt pressure impacting long-term Chicago property investors.
While the litigation is a financial dispute, local diners and patrons of the retail space at 400 North State Street may face uncertainty regarding future tenant stability. Ongoing legal proceedings often impact the management and long-term maintenance of urban commercial properties.
The takeaway
The borrower maintains an expectation that a resolution regarding the loan will be reached through the legal process. Investors should remain aware that personal guarantees can significantly increase exposure when commercial properties face default risks.
Further reading
Find more insights on local property updates in our Chicago Commercial section.
Source note: This article includes information reported by The Real Deal New York.
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