Posted Oct 17, 2008, 1:21 PM
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Join Date: Jun 2006
Posts: 476
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This sounds like a step in the right direction for this building.
AmSouth tower in downtown Mobile set to be sold
Pennsylvania investor makes deal to buy bankruptcy-encumbered downtown office building for $7.2 millionFriday, October 17, 2008
By KATHY JUMPER Real Estate Editor
The 34-story AmSouth building in downtown Mobile is under contract to be purchased for $7.2 million, or about $26 per square foot, by an investor from Reading, Pa., local attorneys said Thursday.
The owners of the building at 107 St. Francis St. in May filed for Chapter 11 bankruptcy protection to halt a pending foreclosure sale.
The owners have filed a motion asking the court to approve the sale to real estate investor Alan Shuman of Reading, and a hearing is set for early November, according to attorney Doug Anderson, who represents Shuman.
The purchase price "will pay for, if not all, 90 percent of all liens and debts owed," Anderson said. "Everybody should be happy with it."
The buyer has 60 days to complete an inspection of the building and another 30 days to close on the sale, Anderson said. "My client has been in town this week to commence the due diligence, and we're moving forward as fast as we can."
Shuman said Thursday that he plans "to spend a whole lot more than the purchase price on renovations."
The six-story, 480-space parking garage was one of the biggest selling points, he said.
"The parking garage by itself is probably worth $4 (million) or $5 million," he said. "We go out of our way to look for buildings that have their own parking."
The sale could close by the end of the year, according to attorney Irving Silver, who represents the owners, Mobile Tower Limited Partnership. The partners are heirs of the late Wylie Tuttle and Herbert Papock, both of Collins Tuttle & Co. in Manhattan.
The owners of the circa 1965 building, who owed back mortgage payments, had been working with BGK Group, a private real estate company based in Santa Fe, N.M., attempting to sell a 50 percent ownership in the building.
BGK's contract had expired and "apparently they were distracted because of the hurricanes," Silver said. "They had tremendous problems in Louisiana and Texas with some of their properties."
Shuman's purchase will not be a partnership, Silver said.
"It will be the end of a continuous legacy of over four decades of involvement of the Tuttle and Papock families," he said. "They are sad about that."
The building's mortgage is held by LaSalle Bank National Association and serviced by Orix USA Corp., an investment banking and financial services firm based in Dallas. The lender is holding in escrow $2.25 million that the owners received from what is now Regions Bank when the bank canceled its lease and moved to the 35-story RSA Battle House Tower, according to the AmSouth building managers. The owners had planned to use that money to upgrade the building, according to Silver.
The building is listed for sale by Harbert Realty Services in Birmingham at $11.5 million.
The pending purchase has not stopped efforts to lease more than 100,000 square feet of available space in the 280,000-square-foot building, according to John Toomey of Toomey & Co., the building's leasing manager.
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