March 19, 2013 | 18 views
No winner in Middle Bay Auction
Trustee ‘optimistic’ that it will remain a golf club
The auction to sell the lease to the devastated Middle Bay Country Club in Oceanside did not have the intended result.
“There was no successful bidder,” said attorney Kenneth Kirschenbaum, the Chapter 7 trustee appointed by Eastern District Bankruptcy Court Judge Dorothy Eisenberg. “We were not able to get a bid acceptable to either the landlord or the creditors.”
Kirschenbaum added that there was, however, a highest bidder, and that “there is no signed deal, but I am optimistic that an operator will be found to take over as a tenant and that the property will remain as before: a golf club and catering
That could be good news for the former members of the golf club, many of whom reportedly moved to other local clubs after Superstorm Sandy and Middle Bay’s decision to declare bankruptcy.
The March 12 auction was held behind closed doors, and neither Kirschenbaum, the court-appointed trustee, nor the auctioneer, Richard Maltz, would comment on the prospective bidders that showed up or why the bidding did not produce a winner acceptable to the owner or the debtors..
According to court documents, the 143-acre property is owned by J.W. Mays department store heir Lloyd Shulman, and is leased to the Middle Bay Golfers’ Association through the Carmel, New York-based Weinstein Enterprises. The lease, which has 13½ years left, costs about $500,000 a year.
Before the storm, the club had 230 members, and its catering facility was used by many local organizations as well as for weddings and other functions. Officials say that most of its members have gone elsewhere.
Maltz said that the opening “key money” bid — the minimum amount necessary to take home the key and the lease — was $2.6 million, but $2 million of that was to be held in escrow and eventually used for the needed course repairs and the renovation of the clubhouse catering facility.
Court documents show that a Chapter 7 bankruptcy petition was filed on behalf of the board of the golfers’ association on Jan. 23. According to the federal bankruptcy website, a Chapter 7 bankruptcy case does not involve the filing of a plan of repayment, as is the case in Chapter 13 filings. Instead, the bankruptcy trustee gathers and sells the debtor’s nonexempt assets and uses the proceeds to pay creditors.
Kirschenbaum said that he expects negotiations with the unnamed highest bidder to take a week or two, at which point the new leaseholder’s name will be made public.