Contrasting Results of 2 Repo Property Auctions in 2 Cities
This month, two repo property auctions held in two cities had contrasting results. In the Whitehaven neighborhood of Memphis, a 460-unit residential apartment building was successfully sold in a foreclosure sale while in Elyria, Ohio, residential and commercial buildings owned by businessman Jay G. Tokar were not sold.
The multifamily Winbranch Apartments in Whitehaven was acquired by LBUNS 2004-C4 Millbranch Road LLC, an affiliate of Miami firm LNR Partners Inc. during one of repo property auctions held by the court of Shelby County. The complex was previously owned by Winbranch II LLC, an affiliate of Miami firm Alterra Capital Group, which has been investing in multifamily properties in Memphis in recent years.
Winbranch II LLC failed to pay the $6.8 million it borrowed from SunTrust Bank in April 2004. A series of refinancings put the property deed into the possession of LBUNS 2004-C4 Millbranch Road LLC.
The Winbranch Apartments complex was built in 1973 and sits on nearly 26 acres.
On the other hand, in Elyria, Ohio, tenants of foreclosed residential and commercial buildings owned by Jay G. Tokar have been worrying about their situation because nobody has expressed interest in the buildings after they have been offered for sale in two repo property auctions.
The tenants are particularly bothered because some services such as ventilation have not been stable since the buildings received repo property notices in 2007.
Thomas Stuber, CEO and president of Lorain County Alcohol and Drug Services which is one of JGT Annex tenants, said he is concerned because he likes the location of the building and the on-street parking available after office hours. He said the location is accessible to the agency’s clients who come to the agency for its adult treatment programs. He added that the agency serves about 80 people everyday.
Don Brackenhoff, Elyria’s economic development head, said that lenders typically send their representatives to the repo property auctions to bid on their properties if there are no other bids. But in the case of the JGT buildings, the mortgage owner, National City Bank, also faced financial difficulties. The bank, which filed the foreclosure action, was acquired by PNC Financial Services Group Inc. last December.
The repo property JGT Annex had an appraisal of $360,000 while the Middle Avenue properties had an appraisal of $270,000.
