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Project Outline
Jordan Carter and Charles Brazer in the Portland office of GVA Kidder
Mathews were contacted by the Personal Representative of a large Estate
to evaluate and sell two historic buildings and a vacant lot in downtown
Coos Bay, Oregon. Believed to be the tallest building on the Oregon
Coast, the Tioga Hotel is a 9 story building built in 1926 that was
operating as 51 apartment units with 6 retail spaces. The Koski Building
located next door was built in 1920 and is comprised of 19 apartment
units and 2 retail spaces. Both buildings are on the National Registry
of Historic Places.
Challenge
The Estate obtained possession of these properties in January of 2006
after the death of the owner, who had owned them since 2004. The Estate
enlisted our services in May of 2007 with a court imposed date to close
the sale of the properties by December 2007.
Coos Bay, the largest city on the Oregon Coast, is a historic
blue-collar town that has been economically depressed over the last 20
years. The downtown core suffers from high retail vacancy and the
tenant demographics for housing is primarily lower income.
The Estate obtained the properties with little prior financial and
business records. Both buildings suffered from deferred maintenance
with several projects left unfinished and four of the retail spaces
vacant at the time of the listing. Both had been leveraged by the
previous owner so the outstanding debt nearly equaled the market value.
Several complicated tax and title issues existed and the status as
Historically Registered buildings further complicated the transaction.
Approach
With a deadline to market and close the sale of these properties within
seven months, we met with the Personal Representative and onsite manager
to gather all available records and obtain a solid understanding of what
the properties entailed, including their current operations, history,
and who the target buyer might be and for what possible uses.
Utilizing all resources, we created a detailed analysis of the current
operations from the partial records available and determined a market
value for the buildings. The detailed marketing package described the
current, past, and potential future operations for the buildings, along
with a detailed physical description and overview of the improving local
market conditions.
Upon finalizing the marketing materials, we undertook an aggressive
marketing campaign utilizing our company’s national platform to target
investors around the country who may be interested in the buildings, and
those potentially interested from a development standpoint. We worked
with several parties, including the Estate, City, and LandAmerica Title
to clear up the multiple challenging issues precluding a sale.
We fielded numerous inquiries from interested investors around the
country and carefully qualified each with the goal of locating the most
qualified buyer.
Results
We located and represented a qualified out of state Buyer through our
marketing approach, assisted in clearing up all title issues, and
ultimately facilitated the sale with a closing prior to the December
deadline at 90% of the original listing price.
The Estate successfully sold the properties with positive equity and the
Buyer obtained two buildings on the National Historic Registry with
significant upside. |
