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Foreclosure Could Leave Duluth With $500K Debt

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Nov 29, 2008 8:09 pm US/Central

Foreclosure Could Leave Duluth With $500K Debt

DULUTH, Minn. (AP) ― The foreclosure of a historical building that provided housing for the poor has the city of Duluth facing a loss of more than half a million dollars.

The Eustone property was designed in the late 1800s but recently fell into disrepair. Two years ago Twin Cities businessman Edward Yu renovated it using a $1 million bank loan and more than $560,000 in loans from the city and its Housing and Redevelopment Authority.

But after he failed to make the loan payments the property was foreclosed on this year, leaving the status of the loans in doubt.

The city sued in October to recover $118,000 from its portion of the loans.
HRA director Rick Ball says his agency is investigating options to recover the money.

Yu's attorney, Jon Koneck, declined comment.

(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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