Greg Bronstein’s former Dogpatch party pad at 1200 Indiana Street, complete with a cantilevered hot tub overlooking the living room island and a temple to showering behind, was foreclosed upon and sold for $2.179 million on the courthouse steps in San Francisco yesterday afternoon.
On the market for a little over two million in 2006, the four thousand square foot space quietly sold to a real estate agent for $1,680,000 that September and then returned to the market listed for $2,999,999 last year, at which point the property was already in pre-foreclosure.
Oh the stories that shower could tell…
Lots of pushing and shoving to get under the rain head?
I never understand these transactions. Bought for $1.68M, then sold for $2.18M on the courthouse steps — $500K above the previous purchase price. So it seems like the bank actually made money on the transaction? Or did some stupid lenders allow the previous owner to leverage way past 100% of the purchase price?
I think it really depends on whether there was a second lien. If so, the holder of the second may have paid the first in cash and then credit bid the second lien debt. Either way,someone must have showed up at the sale and bid cash to cause it to go at a higher auction price than the amount of the first lien which was being foreclosed. In terms of whether the bank made money, I don’t think so. A foreclosing lender can only collect its debt from the sale. Any excess proceeds after satisfaction of the debt go to the next lienholder in line, and if there is no next lienholder, then to the borrower. The bank can only collect the amount of debt it is foreclosing. This is not to be confused with a bank buying through a credit bid at the sale (which is usually the case) and then selling the property later (once it has become “REO” to the bank) at a higher sale price. Then the bank literally can “make money” but those don’t seem like these facts.
My guess is that there is a story behind this, and it may involve tax liens or judgment liens. There was some reason the owner didn’t (or couldn’t) just sell it to pay the bank and then pocket the surplus.
The estimated mortgage debt at the time of the sale (to a third party) was around $2,116,629, not including any other liens.
Got it. Must be pretty creative banking/financing to get to 126% LTV ($2.12M debt / $1.68M purchase price). I guess there were some creative appraisals and/or serious default penalties.
The purchase money loan was re-financed in October 2013, and in default by June.
Loan to own?
Actually, a bunch of lookie loo’s were thinking they could buy the property at the starting bid.
Status: Sold to Third Party
Estimated Debt: $2,116,629.47
[Starting] Bid Amount: $389,300.00
Sale Amount: $2,178,932.75