Two downtown buildings sell at auction to out-of-town investor
01/12/2013 7:32 AM
01/12/2013 7:32 AM
The Farmers and Bankers Building, 200 E. First St., and the Landmark Square Building, 212 N. Market, were auctioned Friday as part of the liquidation of the holdings of two embattled Minnesota developers.
The connected buildings went for $578,000, which includes a required 10 percent premium over the amounts actually bid. The winning bids by the same out-of-town investor were made by phone, with auction staff signaling the bids. The winner’s identity was not released.
A third building, the former Hubris Communications building at 216 S. Market, was sold to an entity owned by Fidelity Bank for $72,050.
The three buildings are owned by FB&L LLC, a company controlled by Minnesota developers David Lundberg and Michael Elzufon, who are principals of Real Development. Lundberg said in December that they were selling the buildings because the properties were losing money.
The three buildings are among more than 10 downtown buildings Elzufon and Lundberg bought starting in 2004. They renovated and sold some of the space, but the recession and credit crunch beginning in 2008 dried up the pool of lending and investment money, halting their projects.
In addition to selling three buildings at auction on Friday, the developers last month shed their interest in the on-again, off-again $65 million-plus Exchange Place project.
The winning bidder for the Farmers and Bankers Building and Landmark Square is a quality investor, said Whitey Mason, regional director for AmeriBid, the firm that ran the auction.
“It’s absolutely a good thing for Wichita in general,” Mason said.
Mason described the new owner as a doctor who has invested in commercial real estate across the country.
The conjoined Farmers and Bankers and Landmark Square buildings are about 60 to 70 percent leased, Lundberg said in December.
The former Hubris Communications building is leased to Mosaic Wichita, which serves the homeless.
Al Sanchez, senior vice president for marketing for Fidelity, said the bank hasn’t decided what to do with the building.
The bank was interested in it because it is across the street from the bank. Once it takes possession, the bank will bring in engineers and architects to evaluate the building, he said.
The sales must close within 30 days.
FB&L LLC bought Landmark Square and the Farmers and Bankers Building in September 2006. They took out a $600,000 mortgage loan on the properties at that time.