Barely a year after acquiring the state Department of Human Services as a tenant, owners of Iles Park Place on Ash Street have been hit with a dozen mechanic’s liens and two lawsuits filed by contractors who say that they haven’t been paid.

Chris Stone, a Springfield businessman who is the public face of the ownership group, acknowledges owing contractors $1.5 million for work at the business park, which was renovated last year in anticipation of state workers moving in. Stone blames tardy lease payments from the state for financial problems. He said that the state is about $1.4 million behind.

A lawyer for B&B Electric, which is owed more than $895,000 and filed suit on Aug. 3, said that late lease payments aren’t enough to make creditors whole, and so the building likely will have to be sold. In addition to contractors, the ownership group owes money to Dieterich Bank, which holds a mortgage to the property that Stone and his partners purchased in 2011.

“What you do is, you gather all potential claims and ask the court to sell it at auction and start parceling it out according to interests,” said Bradley Huff, B&B attorney. “In my mind, the building’s worth something. Is it enough to pay every person? I can’t say.”

A lawsuit filed in April by Flooring America, which was owed more than $8,800, was dismissed in May, after the company was paid, according to records at the Sangamon County Recorder’s office.

Paying property taxes and the mortgage is the top priority, Stone said. “The banker’s obviously not happy with the lawsuit being filed by the vendor,” he said. Stone disputed Huff’s contention that the ownership group would still be underwater even if the state were current with lease payments. “If we’re only 60 days past due, B&B’s paid off,” Stone said. “That lawsuit doesn’t happen.” He says the state is five months behind; Jamey Dunn, spokeswoman for the comptroller’s office, said that the state has been as much as six months late paying the lease.

While blaming late payments from the state for financial distress, Stone said that renovation costs on the building came in over budget. He also said that the ownership group erred in setting the lease price, which averages between $11 and $12 per square foot. The price was set on the assumption that the state wouldn’t fall more than 60 days behind in making lease payments, Stone said. Other landlords for the state, he says, charge between $14 and $16 per square foot.

“We made the assumption that they (the state) couldn’t get worse in terms of making their payments,” Stone said. In 2011, Stone and his partners purchased the building, plus the Mendenhall and Bressmer buildings in downtown Springfield and a building on Jefferson Street that contains state Department of Public Health offices. It has not been a profitable venture, Stone said.

“Seven years, and we’ve made nothing,” Stone said.

In 2014, Henson Robinson filed a mechanic’s lien for nearly $400,000 for work performed on the Jefferson Street building. That debt was paid in 2015, according to files in the recorder’s office. Also in 2014, Pacific Management filed a $37,000 lien for failure to pay building management fees due for the Bressmer and Mendenhall buildings. The lien was filed after the ownership group notified Pacific Management that it was terminating a building management agreement. In 2015, Pacific Management and Stone’s group agreed to a $75,000 settlement, which included a $51,000 early-termination fee for the management contract that had been set to expire in 2018.

Pacific Management was founded by Springfield political power broker William Cellini, who has transferred the company to his daughter and son, both of whom are listed as vice presidents in the company’s 2016 annual report filed with the Illinois secretary of state’s office.

Stone said that Pacific Management has been paid. “We bought them out, essentially,” he said. He said that late lease payments from the state, plus a dispute over the amount owed, prompted Henson Robinson to file the 2014 lien against the building on Jefferson Street.

Contact Bruce Rushton at [email protected].