WHITE PLAINS, N.Y. -- The holder of a mortgage for the former Borders site in downtown Mount Kisco will take over the property following a $6.5 million bid that was made at a Tuesday foreclosure auction.
The mortgage holder is an entity called GCCFC 2007-GG11 Kisco Retail, LLC. In February 2013, it sued the property's owner, Mt. Kisco Associates, LP, claiming that it defaulted on the mortgage. The loan, agreed to in September 2007, has terms that include a principle balance of $6.3 million, an interest rate of 6.815 percent. Other provisions include a maturity date of Sept. 6, 2017 and allowing for interest-only repayment until 2012.
The landlord, through a response document from its legal counsel, denied the allegation.
About a year went by without submission of new documents for the court case before it was disclosed that both parties agreed to allow for the property to go into foreclosure. The auction was held at the Westchester County courthouse in White Plains.
Michael Blumenthal, an attorney for the plaintiff, made the bid on its behalf. Speaking with reporters after the auction concluded, he confirmed that the transaction will close within 30 days.
He did not know what will happen to the property next, although scenarios could include a sale or lease. The process for what to do next will be managed by another group, according to Blumenthal.
Regarding the financial structure of the price amount, Blumenthal confirmed that the plaintiff has a credit bid, which is up to its judgement amount.
The judgment is now roughly $9.5 million due to accruing interest, Blumenthal explained.
Blumenthal, a partner with Thompson & Knight LLP, declined to comment on whether the difference between the amount owed and the price would be pursued.
The amount owed to the plaintiff, according to a court filing earlier this year, was more than $9.1 million as of Feb. 6. It included the principle, interest, legal fees and a pre-payment premium.
A judgment order in connection with the case allows for the plaintiff to pursue further legal action if the sale amount is less than what is owed. Blumenthal declined to comment on whether the difference between the two prices would be pursued.
The bid price is nearly $1.2 million more than the full market value for the property listed in Mount Kisco's assessment roll, which is $5,372,928. The site, located at 154-162 E. Main St., has an assessed value of $972,500.
The property's mortgage has a lengthy and convoluted history, records submitted to the state Supreme Court and the U.S. Securities and Exchange Commission show. In 2007, the loan originated from Greenwich Capital Financial Products, Inc., a subsidiary for the Royal Bank of Scotland Group, plc. The lender transferred the loan and other mortgages to a corporate sibling called Greenwich Capital Commercial Funding Corp. That entity, which also collected mortgages from a division of Goldman Sachs, transferred them to a trust that was administered by LaSalle Bank National Association. The trust initially had a principal amount of more than $2.6 billion.
The trust, a mortgage-backed securities vehicle, was used in connection with certificates backed by the loans, according to SEC records.
Court records show that the loan, which was taken over by Bank of America when it acquired LaSalle, was transferred to U.S. Bank in August 2012. The loan was given to the plaintiff later that year, records show.
The bid price is nearly $1.2 million more than the full market value for the property listed in Mount Kisco's assessment roll, which is $5,372,928. The site, located at 154-162 E. Main St., has an assessed value of $972,500. An August 2007 appraisal valued the property at $8.5 million, according to an SEC filing.
The only other bid for the property was on behalf of Alan Fried, who was at the auction. Rosa Cascardo, who made the bid for Fried, offered $6.3 million as the highest figure.
Jodi Kleinick, an attorney who has represented Mt. Kisco Associates, did not respond to a request for comment.