Bank Foreclosed Properties for Sale Rising in Colorado

by Peter Vernon on States

The number of bank foreclosed properties for sale in the commercial real estate sector of Boulder Valley is rising, based on public records of commercial foreclosures in the area.

As owners of residential properties struggle to pay their loans, owners of commercial properties are also facing difficulties in getting tenants and in finding lenders willing to refinance their loans.

One major Boulder Valley property that has been foreclosed by its lender is the multi-use office building on Centennial Parkway, which was formerly occupied by failed home builder McStain Enterprises Inc.

Based on foreclosure filings and public records, the 42,600-square-foot building was purchased in 2004 by Boulder-based investment firm Crestone Capital Advisors LLC for $3.5 million. In February 2007, Crestone mortgaged the property to Nomura Credit and Capital for $5.37 million at a ten-year term and a 5.85-percent interest rate.

This September, Nomura sued for foreclosure of the property, claiming that Crestone Capital failed to make monthly payments that were already due.

According to some reports, Crestone Capital failed to make the loan payments because its main tenant McStain failed to pay its rent that has reportedly reached $2 million. McStain however filed for bankruptcy protection in May and it is still reeling in bankruptcy up to now.

Another commercial property that could enter lists of bank foreclosed properties for sale in Colorado is the nearly 40,000-square-foot auto dealership building on 28th Street in Boulder.

Bank of Choice foreclosed on the property and bought it back from an auction held in September. The property was originally purchased by former Ford dealer Champion Ford LLC in 2005 for $6.2 million. It borrowed $4.6 million from Bank of Choice to complete the purchase, signing an adjustable rate commercial loan.

In 2007 and 2008, as the sales of Ford cars declined in the area and throughout the U.S., Champion Ford faced severe financial difficulties. It shuttered its business in early 2008 and then leased the property to a Kia dealer called Anderson Kia.

Kia also later closed in the last months of 2008 as car sales continued to decline.

Last May, Bank of Choice finally filed foreclosure proceedings after John Chamberlain and his Champion Ford dealership failed to make the needed deals to pay the $4.2-million remaining loan balance.

According to Bill Beamer, vice president for special assets at Bank of Choice, after the bank resolves a junior lien claim and gains complete ownership of the property, it will include the dealership location in its bank foreclosed properties for sale.