THE SALEM NEWS - O'Shea fetches $1.47M at auction
By John Castelluccio Staff Writer
PEABODY - The historic O'Shea
building, a cornerstone in Peabody Square, sold for $1.47 million Thursday
afternoon at a foreclosure auction that attracted a crowd of
interested bidders and city officials.
The high bidder, Pat Todisco of
Todisco Properties, said he and his son share the mayor's vision for the square
and the 9 Main St. property. They plan to gut the interior and have a
restaurant on the ground floor with 21 apartments above - exactly the type
of project city officials have said they hoped to see there.
"What sold me on (this) was
that the mayor really has a passion for the downtown," Todisco said after
putting down his $50,000 deposit and signing the paperwork.
The deteriorating conditions
inside the three-story building were evident as the bidding got underway in a
large, open room on the third floor that overlooks the square. No one was
willing to bite at the suggested opening bid of $2 million. Bidding began at
$500,000 instead and quickly escalated from there.
Todisco and the runner-up bidder
got into a heated exchange afterward that lasted several minutes, causing the
auctioneering staff and others to intervene.
The Todiscos first looked at the
building three months ago, he said, and even tried to buy it at that time, but
then decided to wait for the auction upon learning of multiple debts tied to
"This is new and big to
us," he said, explaining he and his son Steven have mainly taken on
smaller-scale projects. Their property management company is based in Peabody
and the elder Todisco has lived in the city for 30 years.
Bankruptcy and debt
The auction brings to a close
developer Dan Bandar's troubled ownership of the downtown property.
Bandar purchased the building in
2013 for $1 million with grand plans for a boutique hotel and upscale
restaurant. Those plans slowly fizzled over the years as Bandar struggled to
find investors, according to city officials.
Foreclosure proceedings were
initiated this spring by Lowell Five Cent Savings Bank, which holds the mortgage,
and culminated in Thursday's auction.
Bandar also filed for Chapter 7
bankruptcy in federal court on May 10. According to those documents, he owes
the bank about $800,000 for the LLC associated with 9 Main St.
In addition to covering that
debt, sale proceeds will cover about $33,000 in back taxes and other fees
Bandar owes the city, as well as the outstanding balance on a $250,000 loan
from the Peabody Community Development Authority. That amount is approximately
$220,000, according to the city.
Todisco said he already discussed
those details with Mayor Ted Bettencourt prior to Thursday's auction and
assured him the city would get its money back "one way or the other"
if he were the winning bidder.
Among the onlookers was
commercial broker Brian DApice, who sold the building to Dan Bandar four years
ago. He said he was interested to see who picked it up now.
Community Development Director
Curt Bellavance and Building Commissioner Al Talarico were also on hand, along
with city councilors Pete McGinn and Joel Saslaw. In total, the auction
attracted about 30 people.
Todisco said he and his son will
be financing the project with their own resources, and they plan to start work
as soon as they close.
"There are no
investors," he said.
They have already had
contractors, engineers and an architect walk through the building.
Within 60 days, he said, a demolition crew should be on scene gutting the
The facade, the most striking
feature of the building, will be spruced up with exterior lighting, he said.
Storefront awnings will also come down.
The O'Shea building, which
contains about 30,000 square feet, is currently configured as separate
commercial units on the first floor with office space and other larger rooms on
the second and third floors.
Todisco said the new apartments
will be mainly one-bedroom units with a few two-bedrooms. They hope to work out
a parking arrangement for tenants with the city at nearby municipal lots.
The Todiscos are entering the
downtown market in a big way. On March 31, they bought the building next door
at 11 Main St. from developer Norman Lee and his partners for $1.75 million.
Lee bought it in 2013 and fully
renovated the upstairs into 10 apartments, but didn't do anything with former
Congressman John Tierney's previous district offices on the first floor.
Todisco said they plan to bring
in a restaurant there as well, and will look at moving their home office from
Jennifer Lane down to Main Street.