Surprise! Surprise!
The highest bidder wasn’t high enough, so a historic downtown department store building filled with unfinished condominiums is headed to Uncle Sam’s balance sheet.
The Federal Deposit Insurance Corp. attempted to sell the White’s Building, 936 Broad St., at a foreclosure auction this morning.
The minimum bid for the former J.B. White department store was $1.5 million. The FDIC “withdrew the ad” for sale after receiving only one bid of $800,000 from a Martinez businessman.
Without a buyer, there was no foreclosure on the loan, said FDIC spokesman David Barr. For now, the White’s Building will remain another non-performing loan on the books of the FDIC-seized Haven Trust Bank, which failed in December 2008.
The condo-office project is now headed for a national structured sale, packaged with 7,200 other non-performing loans in the federal agency’s possession.
“We transfer the loans into a limited liability corporation. And then we market an interest in that LLC. The FDIC retains part ownership,” Mr. Barr explained. “Since the FDIC has an equity stake, it helps us realize any upside potential.”
That sale is expected to end in mid-December, he said.
Whoever buys the majority stake would be responsible for working out the loans, Mr. Barr said, and that entity would then be responsible for either selling the White’s Building or finishing off the 51-condo renovation project.
The transformation of the old store into condominiums and office space halted after Duluth, Ga.-based Haven Trust failed. The building’s Atlanta-based developer had its construction loan through Haven Trust.
The FDIC took the building into receivership in May after Horizon Group Investments defaulted on the $5.7 million loan with the commercial space and one floor of condos completed.
With the FDIC’s decision to place the White Building loan into the sale, today's auction bidder won’t have the chance to up the price, Mr. Barr said.
The bidder was Gurjit Jalli, who owns Oncar Automotive, a car rental business, on Prince Drive in Martinez.
“The property was to be sold here,” he said after the proceedings outside of the Augusta Municipal Building. “If they pulled it, it is their decision.”
Comments
Surprise! Surprise!
Imagine that!
Should we start calling it the "White's Elephant Building"?
If they won't to get it off their hands they should have taken the 800,000 especially since it was the only bid.
Yes, SayNoMore, I think it should be White's Elephant Building :)
Something else is at work here. I would like to know what the next step is for the building.
What don't people understand about a "minimum bid". If it was $1.5 million and you don't have it, then DON'T bid.
Brad Owens. The next step is that the property is going to be packaged and sold in a bundle, with other properties, as an LLC. Investors are going to buy the package at some point, and then they are free to do with it whatever they please. And Augusta GA isn't exactly a thriving hot spot, so it'll most likely just sit. And that elephant won't ever die. I wouldn't expect further completion. The price will have to drop way down to make it profitable for anyone to renovate it. However, Mr. Jalli- or another investor- will be free to offer $800,000, or any other amount, to the LLC to buy it.
The Augusta Chronicle ©2012. All Rights Reserved.
