Credit union looks to sell Iowa City high-rise properties after failed sheriff’s sale

IOWA CITY — The credit union that acquired a group of downtown Iowa City high-rise buildings — including the Chauncey — when a sheriff’s sale failed to produce any bids, is working on a plan to sell the properties.

Earlier this year, a Johnson County judge ruled in favor of GreenState Credit Union, which filed a petition in February to collect a debt of loans for real estate projects related to developer Marc Moen and “his family members and friends,” totaling about $28 million, according to court documents.

A sheriff’s sale last week attempted to sell three of the properties:

No one bid on the properties at the sale, which means they revert to GreenState ownership.

GreenState, in a statement to The Gazette this week, said it is “exploring options.”

“As a local lender established in Iowa City, we fully understand the prominence of these properties and how they impact the Iowa City downtown area. As a last resort and to protect our members we felt obligated to move forward with the foreclosure process. GreenState will be exploring options and has retained an Iowa-based management team and Johnson County realtor to manage and market the property,” the credit union said in a statement.

Only parts of the three properties are impacted because GreenState has no claim to any commercial or residential units in the properties that have been bought individually.

FilmScene, Iowa City’s independent cinema located in the Chauncey Building, is not impacted by the foreclosure process as it owns its units.

“While we hope the process will be quick, we cannot provide a timeline as we are just now able to start marketing the property. We anticipate speaking to many potential buyers over the next several months to develop a sales plan,” GreenState Credit Union’s statement said.

No bids received at sheriff’s sale last week

Dozens of people were present at the sheriff’s sale last week in Iowa City, but no one bid on the properties. The opening bid for the three properties in the sale was set at $24 million. A judgment amount listed the properties at $26.5 million.

In addition to the three buildings, a parking lot at the intersection of South Clinton Street and East Burlington Street originally was listed in the sheriff’s sale. However, that parking lot will now be sold separately.

Sheriff’s sale followed April foreclosure ruling

Before the foreclosure ruling in April, GreenState had been working with the buildings’ development teams for more than a year to restructure the debts. Those discussions proved “fruitless,” according to court documents, so credit union officials initiated foreclosure action.

GreenState, in filing for a summary judgment, asked the court to enter a judgment in its favor against Marc Moen, Michael Moen, Robert J. Jett, Monica Moen, Central Park LLC, The Chauncey LLC, Plaza Towers LLC, Iowa City Health Club LLC and Hills Bank and Trust.

As part of restructuring efforts, all of the defendants — except Hills Bank — entered into a forbearance agreement with GreenState in June 2024, according to court documents. The agreement meant the defendants and lender would agree to a voluntary transfer of property ownership. Moen and others also signed a consent foreclosure decree, in the event they failed to repay the loans by Dec. 31, 2024.

When the loans were not paid off, GreenState filed a motion for a summary judgment in its favor. A judge ordered the properties to be sold at a sheriff’s auction.

Trish Mehaffey of The Gazette contributed to this report

Comments: megan.woolard@thegazette.com

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