Lenders in southern California looking to unload the vacant
42,000-square-foot condo-retail building they took over from the
Gilroy Garlic Festival Association earlier this year are accepting
sealed bids they will open and consider next month.
Lenders in southern California looking to unload the vacant 42,000-square-foot condo-retail building they took over from the Gilroy Garlic Festival Association earlier this year are accepting sealed bids they will open and consider next month.
It’s like a silent, highly secure auction by mail, and Mark Sanchez, a commercial real estate professional and vice president of Colliers International’s Gilroy branch, said he has received plenty of offers, mostly from individuals. However, he doesn’t know what they say, and neither will South Valley National Bank officials in Santa Barbara, until they open the written offers Sept. 1, he said.
“The bank is the sole decider, and they reserve the right not to accept,” Sanchez said.
Gilroy-based South Valley National Bank Senior Vice President Kurt Michielssen declined to comment, and neither he nor Sanchez said how much the bank wanted for the entire building. The bank is not accepting individual offers for the 24 condos in the three floors above the first-floor retail and office space.
“It’s all or nothing,” Sanchez said.
To get an idea of how much the building cost, the Garlic Festival Association lost more than $1 million developing its commercial-residential project while the housing market crumbled. Last October, after the condos spent five months on the market without a single offer, the festival board decided to stop making payments on the $8.8 million construction loan it took out with its partner, Pleasant Valley Development Group, to co-finance the project. The project was built by Tanglewood Construction, whose president, Randy Moen, also heads Pleasant Valley.
The spacious terracotta building at the corner of Monterey and Lewis streets has sat vacant since then, and the Gilroy Garlic Festival Association moved back into its old office across the street in April.
Home sales throughout the county in June rose 28.5 percent, or 464 units, over the same month last year, but the average price was 27-percent lower over the same period, at $445,000, according to MDA DataQuick Information Systems. In Gilroy, the average condo and townhouse in June sold for $196,600, according to the Santa Clara County Association of Realtors.
Those wishing to make an offer on the building can contact Mark Sanchez at 842-7000.
