Sou’Wester Auction Deal Falls Through

by Tim Wood

            CHATHAM --- The future of the Sou’Wester is again in limbo.

            The Carlisle financial manager who was the high bidder at an auction of the Sou’Wester and Master Mariner properties in June said this week he has withdrawn his bid and will not develop the property.

            Ernest Brown cited the expensive and time-consuming permitting process and the pulling out of a major investor in the project as reasons for withdrawing from the deal.  He also said that based on the problems facing previous plans to develop the property, investors he contacted had “pre-drawn conclusions that the project was not solvent.”

            “Coupled with some of the ‘unknowns’ as is related to what we might find once we inspected the properties…the whole project became a challenge both to complete in a timely fashion as well as make a reasonable return for the investors,” Brown wrote in an e-mail.

            Brown bid $1.075 million for the two properties, located at 1547 and 1563 Main St. in West Chatham, during an on-site auction June 26.  He had 30 days to assemble financing and said he was given an extension due to some complications.  He said at the time he was considering plans for office space and condominiums at the site.

            The property, which has a combined area of .43 acres, is owned by Doris Selewach.  The mortgage is held by Rose Acceptance Corp., and the foreclosure auction was overseen by the Harmon Law Offices of Newton.  The properties carry a combined town assessment of $1,001,450.

            By failing to complete the sale, Brown said he loses a $5,000 downpayment.  The sale should default to the next highest bidder, he said.

            That bidder was developer Ronald Rudnick, who had previously filed plans to develop condominiums on the property.  He said Tuesday that he has not been contacted about the property.

            Rudnick’s previous plans fell through after extensive opposition to his proposal to demolish both the Master Mariner Motel and the Sou’Wester.  Historic preservation advocates said an old farmhouse at the center of the Master Mariner had architectural value, and they also wanted to preserve the Sou’Wester, a former restaurant and bar that was once a general store and post office.  Although it has several non-historic additions, the core of the building is a unique architectural asset that should be preserved, they said.

            Historical Commission Chairman Donald Aikman said Tuesday he was “disappointed that the buyer wasn’t able to put a program together.”  But as long as the Sou’Wester building remains tight to the weather, he wasn’t concerned about its condition deteriorating.  When he inspected the building when Rudnick’s proposal was before town boards two years ago, Aikman said it was structurally sound and in very good shape.  Both buildings have been closed for a number of years.

            Brown, principal and owner of Financial Manager’s Resources, a financial consulting firm in Carlisle, said an initial investor in place prior to the auction withdrew after “taking a bath” on other, similar projects.  Other backing offers were time-dependent and would not work based on the projected time to go through the town permitting process.

            Market analysis showed the project was “reasonable,” he said, but the permitting issues “coupled with the tight margins on the project that could come about if there were structural problems or other physical problems, and this became a high risk situation.”

            Rudnick had proposed building 18 condominiums on the property. Although he reached an agreement with the historic business district commission allowing demolition of the existing structures if they could not be saved or re-used, the plans were withdrawn from zoning board of appeals consideration and never refiled.

9/4/08