The Trustee, David Bradlow, has continued to market the four properties despite the severely depressed real estate market.
In November 2008, the Trustee motioned the Court to approve the sale of the real property located at 335, 343 & 347 Rodriguez Street, Watsonville, California (the "Watsonville Property") to Mr. Norman Bei for $3,075,000. Unfortunately, that sale did not close and was cancelled.
However, the Trustee's efforts turned up another potential buyer for the Watsonville Property and on December 23, 2008 the Trustee moved the Court for permission to sell it to Jong Sik Kim and Chan R. Kim for $3,075,000. The proposed sale is subject to overbid and a financing contingency; however, the sale must close by March 10, 2009. [Trustee's Motion Authorizing Sale of Real Property and Payment of Real Estate Commission]
Unfortunately, the Trustee has determined that the estate's interest in the real property located at 515-525 San Benito Street, Hollister, California (the "Hollister Property") is a burden to the estate and has asked the Court for permission to abandon the Hollister Property. [Trustee's Motion Seeking Order Authorizing Abandonment of Real Property] The Hollister Property was owned through a partnership between Mr. Bruhn and the late Mr. John Maness.
The bankruptcy estate has a 90% interest in the Hollister Property and after many months of marketing, the Trustee has been unable to sell it at a price that would yield any money to the estate after the payment of taxes and the co-owner's payment. The Hollister Property only generates $1,024.34 a month in rental income, which is insufficient to service the secured lienholder's debt. This means the Hollister Property only drains money from the estate and, since there is not a realistic possibility to sell it and realize a net gain for the estate, the Trustee prudently determined it is no longer in the estate's interest to keep the property. If the Trustee is allowed to abandon the Hollister Property, then in all likelihood the secured lienholder (a bank) will foreclose on the Hollister Property.
The remaining two real properties are located in Gilroy and Salinas. Both of these properties are co-owned through partnerships with the late Mr. Maness, similar to the ownership structure for the Hollister Property. The Trustee is still marketing these properties and we will keep you updated as to their developments.
