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Roosevelt Hoping Buyers Fall in Love with Valentines Day Auction

By Eric Richardson
Published: Friday, January 08, 2010, at 04:19PM
Roosevelt Sales Center Eric Richardson [Flickr]

Nine months after entering bankruptcy, Roosevelt Lofts today got a judge's permission to proceed with the sale of units.

Prepare for another round of auction fever.

Judge Geraldine Mund today approved the Roosevelt Lofts' petition to become the latest Downtown condo property to turn to a one-day sale in an attempt to move a large chunk of units. The auction, to be conducted by Kennedy Wilson, is proposed to include 65 units and likely to take place on February 14, 2010.

Unit pricing has not been released, but project's reorganization plan assumes an average sales price of $425,000.

Only units on floor eight and below will be available, as the building's upper floors still need to be completed. According to today's order, floors nine and ten must be completed by March 31, with floors 11 and 12 to follow by June 30.

Today's ruling is good news for a project that has been stuck in limbo. When the Roosevelt Lofts filed for Chapter 11 reorganization on April 13, developer Milbank Real Estate Services put out a statement saying that sales would continue "without interruption."

Nine months later, no units in the building have been sold and the project has turned to short-term leasing as a way to generate some cash flow.

The motion to sell units was opposed by Bank of America, which has the construction loan on the property and has filed to end the bankruptcy case, which would allow it to start foreclosure proceedings. That motion is still set to be heard on February 2, but today's order seems to make clear that Judge Mund views the project's plan for reorganization as valid.

The Valentines Day auction is timed to get the units sold before other nearby projects enter the market. There are currently 350 units on the market in Downtown, according to a declaration filed by Richard Winchell, President of Kennedy Wilson. He expects that number to nearly double in the upcoming months as an additional 305 units hit the market at 705 W. 9th -- another building currently navigating bankruptcy -- 655 Hope and Santee Lofts.

Kennedy Wilson recently operated an auction for nearby Market Lofts, which sold its last 55 units in a one-day event on November 14.

The 222-unit Roosevelt Lofts is located at the corner of 7th and Flower, in the Financial District. It was developed by Milbank Real Estate Services.

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