The Virginian-Pilot
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NORFOLK
An auction Wednesday of the Globe Iron Construction Co. property in the Barraud Park area failed to attract a single bid.
The 17-acre parcel with a 300,000-square-foot shop has been appraised at $6.3 million. SunTrust Bank foreclosed on the property, which is part of the company's bankruptcy case.
Three people signed up for the auction, including the owners of Gutterman Iron & Metal Corp. of Norfolk, but none bid.
The auction was conducted in three parts. Auctioneer William J. Summs of Atlantic Asset Management Group first tried to sell about half the property, which includes the company office building and vacant land. Bidding started at $1.5 million and dropped to $1.3 million with no takers.
Summs then auctioned the other half, which includes the enormous shop building and an adjacent 40,000 square-foot warehouse, but again got no bidders.
He then tried auctioning the entire property, starting the bidding at $6 million.
"You're not going to find anything like this in the city of Norfolk," Summs said in the middle of bidding, trying to entice a crowd that included mostly lawyers and bankers there to observe.
At $3.2 million, he stopped again, saying, "Look at this property."
When he got down to $1.8 million with no takers, the trustee overseeing the auction called it off.
"I think it's disappointing but not surprising that an auction of this type of property could not realize a fair-market bid," said Karen Crowley, the attorney representing Globe in bankruptcy.
Saul Mednick, whose family has owned the business for 89 years, called the outcome "predictable."
An attorney for SunTrust declined to comment on what would happen next.
Crowley said the property could be marketed in an attempt to reach a wider audience of potential buyers.
Globe racked up millions in debt, mostly to upgrade machinery, at a time when the economy made its turn for the worse. Business declined, and the family was forced to file for bankruptcy on behalf of the company. Globe ceased operating this summer.
The company's steel has gone into dozens of Hampton Roads buildings, including Nauticus and the Half Moone cruise terminal, and was used to rebuild part of the Pentagon after the Sept. 11 attacks.
Tim McGlone, 757-446-2343, tim.mcglone@pilotonline.com
Source: http://hamptonroads.com/2012/10/globe-iron-auction-attracts-no-bidders-norfolk
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