High Bidder Plans to Sell Key Claremont Building
Claremont — The New Hampshire Business Finance Authority, an economic development arm of the state, is the new owner of the Oscar Brown Block on Opera House Square.
Jack Donovan, executive director of the NHBFA, outbid three others at Monday’s foreclosure auction with a bid of $210,000. The business finance authority is owed about $450,000 on a loan that was a small but pivotal part of the financing when the historic brick building was renovated in 2008.
The Brown Block is currently home to a restaurant, businesses and apartments.
“We just couldn’t let it go for nothing,” Donovan said after the roughly 30 minute auction in which the bidding by Thomas Saturley of Tranzon Auction Properties began at $20,000 and rose in $2,500 and $5,000 increments.
Holding his bidding card, Donovan quickly countered any bid made.
“We don’t want to be an owner, so we will try to find a suitable buyer,” Donovan said after the auction. “It is a nice building.”
As part of the foreclosure sale, the finance authority will have to pay the roughly $100,000 in back taxes owed on the property for 2010-2014.
“We are going to do what we can to find someone local to buy it and do a good job with it,” Donovan said Monday afternoon.
The sale untangles an extremely complicated financing arrangement that included two types of tax credits and an investment of roughly $1 million from the Monadnock Economic Development Corporation.
“All that goes away as part of the foreclosure,” Donovan said.
“It now becomes a simpler transaction (to sell the building),” said Nancy Merrill, the city’s Planning and Development director, after the auction.
The Business Finance Authority was created in 1992 and works with banks, businesses and the finance sector to facilitate business expansion in the state.
For the Brown Block, roughly $2.7 million in financing was pooled into an investment fund from the different sources and eventually loaned to the Brown Block Development Corp., the building’s co-owner, to renovate the property. In addition to the investment from Monadnock Economic Development Corp., Sovereign Bank invested $1.3 million and received tax credits over the last seven years of nearly $1.6 million.
The unpaid $450,000 loan made by the NHBFA through the Claremont Development Authority is the remaining debt on the property from the original financing. The only liability for the city is some interest owed on the $450,000 loan, city officials have said.
City Manager Guy Santagate said Monday afternoon that the Business Finance Authority is well qualified to market the property.
“They do developments like this and were a big part of this one,” he said. “The financing got complicated, but it is not economically feasible to restore a building like the Brown Block with private financing.
“From an economic development side, this has been very successful. It anchors a historic building next to city hall. Prior debt was a problem, but going forward I think it will be successful.”
The 19th century Brown Block is home to New Socials Bar and Grill and Sugar River Barbers on the ground floor and the law office of Jim Feleen and six apartments on the second floor. It is assessed at $534,000, including the one-third acre lot.
The 10,000-square-foot building was partially owned by Monadnock Economic Development Corporation and Brown Block Development Corp. since being sold by the nonprofit Main Street Claremont in 2007 for $178,000.
Patrick O’Grady can be reached at email@example.com.