JOLIET – Uncertainty looms over the long-term future of student housing at Joliet Junior College.
Centennial Commons, which opened in 2002 to provide housing for JJC students, is being put under the control of a court-appointed receiver after years of losses that appear to have left the complex riddled with debt.
It is unclear who will live in the apartments in the future and who will manage them in the future.
“We’ve told the students there will be no student housing next year,” JJC board Chairman Bob Wunderlich said.
JJC is trying to buy the apartment complex with the likely purpose of demolishing it, Wunderlich said.
But what happens to the apartments, including whether they are rented to students, could depend on the new management.
“We don’t know who would own it and what they would turn it into,” said Kristin Mulvey, executive director of institutional advancement at JJC.
Foundation Housing, a company created by the JJC Foundation, will no longer operate Centennial Commons on May 31. A court-appointed receiver then will take over.
Receiver Drew Millard, a principal of 33 Realty, declined to comment about Centennial Commons on Monday.
The receivership was sought by UMB Bank on behalf of the holders of about $14.4 million in bonds that financed Centennial Commons when it was built. The bonds were issued by Will County in 2002, according to court records.
UMB Bank sought foreclosure of the property on Oct. 6 because of “numerous defaults by Foundation Housing,” according to its complaint.
Gordon Gendler, a senior vice president with UMB Bank, alleged in a
Jan. 19 affidavit that Foundation Housing failed to fulfill the terms of loan documents connected to Centennial Commons and failed to pay about $24.3 million that is owed as of Nov. 3.
Attorneys with UMB Bank were unable to be reached for comment Tuesday.
JJC spokeswoman Kelly Rohder-Tonelli directed questions about Centennial Commons’ finances to the foundation. Foundation board President Rosa Angeles said she wasn’t sure about how much debt Centennial Commons accrued, but said the foundation would not be liable for it.
In court filings, both JJC and Foundation Housing denied several allegations from UMB Bank regarding the finances of Centennial Commons. JJC requested the bank not be entitled to judgment of foreclosure of the property.
Both the college and Foundation Housing also argued against appointing a receiver to take over the property. A Will County judge granted the appointment of a receiver on March 8.
Carl Buck, an attorney for JJC, said from the college’s perspective, the management company of the property, Pinnacle Campus Living, was sufficiently operating it, and a receiver would be an added expense.
Buck said he doesn’t think the student housing complex will change in the short term. He said the housing has not been able to reach capacity and wasn’t making enough money to operate or make a profit for payments on the bonds.
The apartments are only 40 percent occupied, Mulvey said. Three of the six buildings are no longer being used. There are 128 units at the complex.
The apartments are located on 15 acres adjacent to the college campus. JJC sold the land to the JJC Foundation for the purpose of building Centennial Commons.
Community colleges are prohibited by state law from owning and operating student housing, and the arrangement was devised for the sake of creating housing at a time that college officials believed they could attract more students with housing just off-campus.
Because of the size of the district, Mulvey said, JJC believed students living farther away from the main campus would be interested in moving to the apartments. She said certain programs, including the veterinary program, were seen as having potential to attract out-of-district students.
But the demand for student housing turned out to be less than predicted.
Conditions at Centennial Commons also appear to be getting worse.
Wunderlich described Centennial Commons as being “in disrepair.”
He said JJC wants to acquire Centennial Commons because of its location on the edge of campus. Wunderlich expressed concern that the complex could be converted to Section 8 apartments, which use federal subsidies to provide housing to low-income residents.
“We have no control,” he said. “But seeing how it’s going to be our neighbor and contiguous to our property, we’d like to have some control.”
If JJC acquired the property, Wunderlich said, it would “most likely” tear down Centennial Commons, convert the acreage to farmland, and hold the land for future college expansion.