One of the two former GMC dealership properties on Idaho Maryland Road in Grass Valley has gone into escrow, leaving the front property on the market for $1.4 million.
The loan for the former Weaver Auto & Truck Center property was about $8 million, said Lock Richards, managing director of Sperry Van Ness-Highland Commercial.
“I’m sure the amount of money put into the property was probably close to $10 million, but the loan amount was about $7.7 million and the guy that bought it purchased that note at a discount,” Richards said.
The property has been on the market for about six months, Richards said, and the previous owner, Donald P. McCredie of Hemet, Calif., only bought the property less than one year ago. Idaho Maryland Road LLC, a limited liability company owned by McCredie in Riverside County, purchased the property for $5.1 million on March 26, 2012.
McCredie is listed as an owner of Tri Buick Pontiac GMC car dealership in Hemet. According to the California Secretary of State website, Tri Automotive, Inc., the corporation name for the dealership was dissolved on Sept. 2, 2011. McCredie also has another limited liability company called McCredie Land, LLC according to the Secretary of State website.
The amount of unpaid debt on the former Weaver Auto property amounted to $9.3 million at the time of McCredie’s purchase, according to the Trustee’s Deed Upon Sale at the Nevada County Recorder Office, as previously reported in The Union.
“He bought it as an investment and so his goal is to make a profit either through leasing or selling,” Richards said. “Some properties and investors will buy and immediately flip or sell, this one is a little bit longer, but he’s going to look at whatever deal will be the most beneficial for him and his investment parameters.”
The time the property has been on the market is reflective of the current health of the real estate market, Richards said.
“The recession started hitting in 2007-2008 and the activity levels dropped off,” Richards said. “Then it really started to pick up from our perspective, the middle of last year and has been continuing this year. It’s a lot more active than it had been and we are hopeful that it will continue to stay active.”
Weaver Truck and Auto Sales operated for several years on a tiny lot on East Main Street, in Grass Valley, before brothers Tom and Matt Weaver built their 30,000-square-foot facility of stucco, concrete and rock at nearby 400 Idaho-Maryland Road, opening in August 2006. The General Motors dealership took on Chevrolet in 2007, employing about 45 people at its height.
But the economic downturn hit the automotive sector hard. General Motors Acceptance Corp., the financing arm of GM, pulled the rug out from under many of its smaller-volume dealers. It seized Tom Weaver’s fleet of vehicles in October 2008, though Weaver retained his dealer’s license. (By then, Matt Weaver had left the business.)
The slow recovery of the economy is connected to the success of the commercial market, said Jeff Johnson, president of the Pacific Land Enterprises. Though the recovering economy is a factor of the success of the commercial market, the lack of demand for commercial space is the larger factor, said Johnson.
“We’ve seen a bit of an increase in activity but I just don’t think the demand is there yet,” Johnson said. “I don’t think companies haven’t been leasing space because rents are too high. If rents were dropped, is that going to make people want more space? I don’t think so.”
Until more certainty with upcoming legislation, such as with the Affordable Care Act, is finalized, the demand will probably stay stagnant, Johnson said.
“People are still apprehensive about the economy and how the new health-care bill might affect their businesses, but once they get that figured out hopefully there will be some pent up demand,” Johnson said.
The front building on former Weaver site, which totals about 10,600 square feet is on the market for $1.4 million, several million dollars less than the amount the property originally cost to develop.
Several interested parties have looked at the property, Richards said, but have not moved forward to seal the deal.
“We’ve had pretty good interest from all different kinds of folks,” Richards said. “There has seemed to be a lot more interest in people purchasing than leasing.”
The potential for the building to offer city revenue is a point of concern, as the year when the auto dealerships closed down in 2006-2007, the city lost more than $1 million in annual revenue, as previously reported by The Union.
While Richards would not release the name of the new ownership of the second property, already in escrow, he did say, “The new owners are a for-profit service business,” Richards said. The second building was purchased about a month ago, Richards said, and the process should be complete in a matter of a few months.
“It’s an agreed deal and we’re just kind of ironing out the details,” Richards said. “It’s too soon to tell how long it will take, but it’s not going to probably be for several months.”
The listing for the property at 400 Idaho Maryland Road in Grass Valley can be viewed at http://buildout.com/website/56272-sale.
— Staff Writer Matthew Renda contributed to this report.
To contact Staff Writer Jennifer Terman, email firstname.lastname@example.org or call 530-477-4230.
“(The real estate market is) a lot more active than it had been and we are hopeful that it will continue to stay active.”
— Lock Richards, managing director of Sperry Van Ness-Highland Commercial