More than two dozen units in a debt-ridden Lexington lofts project have been sold at a court-ordered auction to satisfy loans made by a bank to a local developer.
Lorillard Lofts, named for the tobacco processing company that operated in the building during the leaf’s heyday, were developed about a decade ago by the McGoodwin Co. along Price Road, in an industrial area just north of downtown.
Twenty-six of the building’s 42 units were liquidated in the sale, designed to recoup some of the investment made by Old National Bank. They ranged from residential units, some of which were vacant, under lease or unfinished, to a commercial office condo to a former boiler room that could be converted into useful space. Collectively, the units sold for $1,015,000.
“We are really excited that the condominium complex is now going to be stabilized with new owners,” said Seth Seaton, vice president at Key Auctioneers, whose team conducted the auction in the building’s common area. “The bank has no more involvement. We’re happy for the current tenants and the new buyers.”
There were bargains to be had. The buyers, a mixture of investors and people looking for new living spaces for themselves or family members, kept the bidding relatively low. Units featured polished concrete floors, 15- to 18-foot ceilings, exposed brick, modern appliances within an urban setting commonly found in much larger cities.
A one bed, one bath flat with 1,317 square feet sold for $29,000. A 1,533-square-foot unit with a loft and two baths sold for $64,000. Two unfinished lofts sold for $33,000 each. The largest property offered was a two-bedroom, two-bath space with a loft and 2,641 square feet. It sold for $127,500.
“I bought one of the upstairs studios,” said Philip George. “It’s already leased out to someone, but I wouldn’t mind living here. This place has a bike-able range to go do a lot of stuff.”
Buyer Ann Hollingsworth had been familiar with Lorillard Lofts and admired it from afar.
“I’ve always been fascinated with this project. I think it has just wonderful potential,” said Hollingsworth. “It has an eclectic group of people for downtown Lexington. It’s quite a unique property. There isn’t anything like it.”
Hollingsworth was searching for living arrangements for her son and daughter, who may want a place in Lexington. “I think they may live in it, to start with,” she said.
A real estate investor, who later declined to identify himself, caused a momentary stir during the auction when he suggested he might be interested in bidding on the entire inventory. However, he ended up bidding on none.
Old National Bank had a court-appointed receiver preserve and protect the property. Once it went into receivership, the receiver acquired the rights of a property owner. The receiver could sell the properties, but the McGoodwin Co. could not, according to the auctioneers.
Lorillard Lofts developer Rob McGoodwin did not attend the auction and could not be reached for comment. However, in a 2010 article in an industry publication focusing on his redevelopment of a tobacco facility, McGoodwin acknowledged that Lexington might have overbuilt lofts and condos.
The sale was designed to meet the expectations of the creditor, Old National Bank. “Obviously, their hope was to get as much money as possible and to get these (units) into the hands of new owners. That was accomplished today,” said Seaton.
For Key Auctioneers, the sale was not uncommon. “I’ve sold as many as a hundred properties at one sitting,” said Seaton. While the auction was somewhat unusual for Lexington, it’s common in places like California, Florida or Las Vegas where a glut of properties have forced large sell-offs. “In the last seven to eight years you could have seen literally anything happen in any market.”
As for Lorillard Lofts, Seaton remained optimistic. “I think they’re unbelievably trendy right now. The loft style is really popular. Why this one didn’t take off, I’m not certain.”