FOR SALE -- A nearly complete transformation of a historic department store into condominiums and commercial offices. The minimum bid for the White's Building, 936 Broad St., is $1.8 million. It will be sold at auction at 10 a.m. Tuesday in the Augusta municipal building. The former J.B. White department store now features 20,000 square feet of retail space and 60,000 square feet of residential condos.
Jai West, the owner of Casa Blanca Cafe in the front of the White's Building, said she has mixed feelings about the building's foreclosure sale Tuesday.
"I hope that (the buyer is) someone local that really cares about Augusta and cares about this building as opposed to some conglomerate who buys it because it's a great deal," she said.
Ms. West opened her coffee shop 11 months ago with the understanding that there would be built-in business from 51 condominium residents and a dozen other commercial tenants.
Three weeks after she opened in December 2008, construction came to a halt. That's when Atlanta's Haven Trust Bank failed and was seized by the Federal Deposit Insurance Corp.
Then in May, the FDIC seized control of the building from the developer, Marietta-based Horizon Group Investments, for defaulting on the $5.7 million loan.
Ms. West said she has struggled to keep the coffee shop running since the troubles began. There's no foot traffic in the building.
Only 10 condos were sold -- seven more now have renters -- and only one of the office spaces is occupied -- two more in the neighboring Doris Building, which was part of the renovation project.
According to the FDIC's lawsuit against Horizon, the developer was overdrawn on the loan by $479,000 with $700,000 of liens on the building by contractors and service providers. The company had failed to pay property taxes for 2008 as well, the suit said.
When work began on the four-story building in the summer of 2007, the idea was to transform the bottom floor into commercial space and then have three floors of condos.
For 54 years it was home to the J.B. White department store, but sat vacant since 1978, when the store moved out to the malls.
The developer paid $1.1 million for the building in 2007. The Georgia Cities Foundation provided $250,000 in financing for the project because it was a historic downtown renovation.
That loan was obtained through the assistance of the Downtown Development Authority of Augusta, which is also a tenant.
"I think the building can work," said Margaret Woodard, the executive director of the DDA and also a condo owner. She said she's optimistic about the foreclosure sale.
Travers Paine III, the building's receiver, said there are multiple scenarios for the sale. The FDIC could sell the loan and the buyer could foreclose on Horizon. If no one buys, the FDIC could choose to foreclose and then package the building into a larger real estate sale.
"There's a lot of interest stirred up by these ads, but that doesn't mean a sale will occur to an interested investor," Mr. Paine said.
The condos that are owned are not subject to the foreclosure and will be unaffected by the action, he said.
Reach Tim Rausch at (706) 823-3352 or firstname.lastname@example.org.