Bank forecloses on Vandivort Center

A foreclosure last week on downtown properties belonging to Springfield banker and entrepreneur Aaron Buerge caught him off guard.

The Vandivort Center, 305 E. Walnut St., was foreclosed on, along with a parking garage at 217 E. Walnut St., according to legal notices published in The Daily Events.
Buerge said he was perplexed by the foreclosure and added that he sold the garage months ago.

“This happened so suddenly. I thought we were going to be able to agree to terms to extend the loan,” said Buerge, president of First National Bank in Springfield. “All I know is they recently had the property reappraised – but that would be speculation by me.”

Nick Raikos, vice president of Mountain Grove-based First Home Savings Bank, which foreclosed on the properties, would not comment on the foreclosure or whether the building had been reappraised.

The original loan amount was $2.44 million, covering the two properties, and Buerge said the balance owed is $2.16 million. According to the Greene County assessor’s 2010 valuation, the Vandivort appraised for $1.02 million, and the garage appraised for $114,900.

Buerge points to a cease-and-desist order against First Home Savings Bank as possibly triggering the foreclosure. The August 2009 order is against First Bancshares Inc., the holding company for First Home Savings Bank.  

“First Home Savings Bank, like some other banks in the area, is under a formal agreement with their governing body, which is the (Office of Thrift Supervision),” Buerge said.

The parking garage at 217 E. Walnut was sold to Downtown Seville LLC, a downtown property development company owned by Craig Wagoner.

Wagoner said he bought the parking garage because of parking needs for his Seville Lofts, adding that the Seville building is more than 90 percent occupied.

Wagoner said he closed on the property nearly three months ago but would not disclose the cost. He said he didn’t believe it was in foreclosure then.

Wagoner’s redevelopments include the Kresge building on the square, now home to the Park Central Branch Library; the Seville and Brentwood buildings on Walnut Street; and the Lofts at Jordan Creek, at the corner of National Avenue and Chestnut Expressway.

The Vandivort property is scheduled to be sold July 29 on the Greene County Courthouse steps, but Buerge said he remains in negotiations with First Home Savings Bank.

Raikos also wouldn’t say whether the bank was in negotiations with Buerge for a new loan or extension.

Buerge’s six-year-old property ownership company AGB LLC, owned the Vandivort property. AGB LLC owns several Springfield properties, including Chestnut Corners, 2025 E. Chestnut Expressway; a residential rental property; and vacant land in Airport Plaza.

Buerge, who co-founded Trolley’s Downtown Bar & Grille, but has since sold his interest, purchased the Vandivort in July 2006 from James Shirato, whose Indian Ridge Development LLC still keeps an office in the building.

“I’ve always made payments on time with the Vandivort property and with the parking garage before I sold it,” Buerge said.

Buerge speculates that problem arose because his loan was a three-year loan.

“Like other short-term loans, typically the bank will just extend the loan,” Buerge said. “I thought that the bank and I had agreed to the terms of the extension of the loan. They told me at the last minute they could not, or would not, extend my loan based on the terms that we were discussing and they were commencing with foreclosure later this month.”

Steve Sweetin, owner of Ice Productions, has rented storage space in the Vandivort building for six years with no issues.

He is one of more than 40 tenants in the building.

“It’s an ice show production company, and we use (the Vandivort) for costume storage,” Sweetin said. “What we’re renting is a small room, or a large closet.”

Sweetin said his monthly rent was $75 six years ago and is now at $119.

Buerge hopes to negotiate an agreement with First Home.

“We are still in negotiations trying to work something out so we can move on down the road,” Buerge said. “We’ll hopefully work something out in the next couple weeks and move forward.”[[In-content Ad]]