Farnsworth Corporate Center in Aurora, IL Slated for November 7 Auction

On November 7, 2013, Farnsworth Corporate Center - a 38,000 square foot 62.4% occupied office property located at 1000 & 1050 Corporate Boulevard in Aurora, Illinois, will be auctioned to the highest bidder in a sale to be conducted at The Union League Club of Chicago, 65 W. Jackson Blvd., Chicago, Illinois at 11am. The auction will start without a minimum or reserve. Details on this as well as the other terms and conditions can be found at www.dkrealty.com/farnsworth or by calling David M. Kaufman, CCIM at (773) 609-3311.

When the ownership of the property saw the handwriting on the wall, they figured they would try an unusual approach to an all too familiar problem on today's commercial real estate landscape. With high vacancies and market rents well below their levels in 2003 (when the owners acquired the property), they realized that continued ownership of the property was not a choice due to negative cash flow, but they also wanted to take a shot at recouping some of the equity that went into buying the property originally.

By holding a lender sanctioned pre-deed-in-lieu-of-foreclosure auction, all parties achieve, or have an opportunity to achieve, their goals that they wouldn't have otherwise had.

The seller now has an opportunity at recouping some or all of its equity or maybe even some profit if the bidding goes high enough. If the bidding goes for less than what they owe on their mortgage, all the sale proceeds will go to the lender, assuming that the lender does not bid at the auction. If the lender does bid at the auction, they will acquire the property pursuant to the terms of the deed-in-lieu agreement that is attached as an exhibit to the disposition agreement entered into between the owner/seller and the mortgagee. By completing their purchase with a deed-in-lieu of foreclosure, the lender is further protected against claims by junior lien holders, if any.

The lender is able to have closure on a loan that is on their radar as a potential liability rather than an asset. With this auction scenario, they are spared going through a very expensive foreclosure (that could become even more expensive should the borrower decide to stave off foreclosure by electing to put the ownership entity into a Chapter 11 bankruptcy "reorganization"). 

The successful high bidder in the Farnsworth Corporate Center Auction on November 7th at 11 a.m. at the Union League Club in Chicago will be charged a Buyer's Premium. The details on this and other terms and conditions of the sale can be found at www.dkrealty.com/farnsworth or by calling David M. Kaufman, CCIM at DK Realty Partners (773) 609-3311.