Up for sale
A premier stretch of Apalachicola riverfront, stretching from Boss Oyster to Caroline’s Restaurant, is up for sale, all stemming from a Chapter 11 bankruptcy re-organization now pending in the courts.
For an asking price of $3.7 million, this prime commercial property features more than 400 feet of riverfront, plus five commercial lots across Water Street. And the owners, Caroline and Larry Maddren will throw in another 400 feet on the bay with boat launch at 2-Mile, the former site of the crab factory, which include the remains of a concrete block seafood processing plant dating back to the ‘40s.
Tallahassee attorneys Robert Bruner and Byron Wright, who are handling the Chapter 11 proceedings on behalf of Seagrape Enterprises of Apalachicola Inc. and Boss Oyster Inc., said the reorganization stems from the two companies’ insurance claims from Hurricane Michael.
Bruner said delays in obtaining sufficient insurance reimbursements didn’t provide the Maddrens with enough funds to rebuild after the Oct. 2018 storm. The hurricane immediately shut down the 24-room inn, the adjacent Caroline’s Restaurant and Roseate Spoonbill Lounge, plus the string of retail and office space that extends to Boss Oyster and its adjacent banquet room and apartment.
“They tried to do it themselves but they didn’t get enough to rebuild,” Bruner said. “They couldn’t get builders, and the bank kept grinding them on interest payments, with no deferral or relief. They were paying commercial debt, with no revenue. They literally expended all the funds to feed the bank and keep skeletal staff.”
With foreclosure looming, the Maddrens turned in July 2019 to a Chapter 11 petition, which would allow the businesses to continue to operate as the courts address the debt.
“That’s allowed us to determine if a rebuild is feasible,” Bruner said.
He said one format would to reorganize the debt, and embark on a five-year repayment plan as some or all of the businesses restart.
The second alternative would be to liquidate some of the assets, and determine the best result for creditors, as the Maddrens continue to operate the businesses as they have for the past two decades.
“We are doing a multiple three-pronged approach to the case,” Bruner said. “We’ve engaged insurance lawyers and we think we have a pretty good line to get enough money back to rebuild one or both of the structures.
“While that’s pending we have engaged a contractor, to estimate a rebuild,” he said. “We have to get insurance money; it’s a little bit of chicken-and-egg.”
The last option would be to sell off everything. “The other option for liquidation is to sell it,” Bruner said. “We have put a price and said we would sell it. We will sell them as a backup.
“She’s marketing them aggressively,” he said, referring to Helen Spohrer, of Berkshire Hathaway HomeServices Beach Properties of Florida, who got the listing just before the end of 2019.
“They don’t all have to be sold in a linear line, they can be sold in pieces,” said Bruner. “The operations of those particular properties are not dependent (on each other).
Spohrer said the sellers have indicated a willingness to sell Boss Oyster separately for $2.5 million, and have listed the adjacent banquet room, beneath a 2,400-square-foot two-bedroom apartment, complete with decks, docks and boat slips along 69 feet of the river, for $750,000.
Those interested in the 2-Mile property, zoned C-1 seafood commercial with a possible submerged land lease for commercial docking, can have it for $300,000.
“They will definitely cut it up,” she said. “It’s all prime riverfront property.”
Spohrer said there have been some recent roof repairs, and the ground levels of the properties have been gutted, but many of the pilings date back to the 1920s, solidly built to weather storms.
“Everything is in ‘as is’ condition and buyers beware,” she said. “It needs a bucketful of cosmetic work.”
One item that is not included in the sales offerings is the liquor license that governed sale of bar and carryout items for Caroline’s and Boss.
Bruner said that sale was handled prior to the Chapter 11 filing by a broker of such licenses. But, he added, since the license is a specialty license issued by the state at a reduced rate for historic properties, to obtain a replacement would cost “a fairly nominal amount of money.”
He said the Maddrens would like to keep the properties in local hands, but he will suggest they turn to a nationally known auction company, with access to big city buyers, if that doesn’t happen.
“They want to retain the atmosphere and the charm,” Bruner said. “But at the end of the day my responsibility is to maximize dollars. We have those contacts and we’ll do it if local people don’t want it.
“Within the next 90 to 120 days, both entities should have a known direction, whether it’s going to be liquidated,” he said. “The bank’s not going to wait forever.”