Rose Hill Bank is suing to foreclose on Kellogg Crossing, a shopping center at 600 S. Tyler Road that is connected to high-profile Minnesota investor David Lundberg.
The bank is seeking $2.87 million, plus fees and expenses, on the original 2004 mortgage of $4.045 million.
Repayment of the mortgage, according to the suit, is guaranteed by a group of Minnesota investors: Infinity Financial-Wichita, Edward and Susan Ambrose of Inver Grove Heights, David and Barbara Lundberg of Annandale, Vincent Seiter of Plymouth, Keith Unger of Jordan and Anna Marie Unger of Jordan.
The mortgage was structured for monthly payments of nearly $28,000 and a balloon payment of $3.19 million that was to be paid in August 2014, 10 years after the original signing. The parties agreed to extend the loan to Nov. 10, 2015, but Infinity failed to pay the note in full at that time, according to the suit.
Premium content for only $0.99
For the most comprehensive local coverage, subscribe today.
David Lundberg, along with his partner Michael Elzufon, later bought a dozen downtown buildings, doing some renovation and bringing in investors before most of their financial arrangements collapsed among foreclosures, lawsuits for unpaid bills and an ongoing fraud case.
Lundberg has said he had been to Wichita a few times when he acquired the shopping center in 2004 as part of a property exchange with other property he owned. When he came to see the property, he asked a real estate agent whether there were other properties in Wichita that would be good to buy.
A lawyer who represents the bank said he had no comment on the matter.