By Kevin Kelley
The two vacant NASA buildings on Brookpark Road being auctioned by the federal government have yet to receive any bids. But the official in charge of the online auction of the property isn’t concerned.
Richard Balsano, a Chicago-based realty specialist with the General Services Administration (GSA), said the level of interest in the buildings and property expressed to his agency is not necessarily represented by the lack of bids.
The GSA held an open house at the two buildings in late July for about a half dozen interested parties, Balsano said. Another open house will be scheduled before the auction ends, he added.
Balsano told West Life he’s not surprised there have not been any bids yet in the online auction, which began July 2. The minimum bid for the property is $200,000.
“It’s not something unusual in our work,” he said of the lack of early bids.
As anyone who has bid for an item on eBay knows, the majority of bids often come in as the auction close nears. Balsano said it’s similar with commercial properties; generally more bids come in once a closing date is announced.
No closing date has yet been set for the auction the GSA is conducting for what the NASA Glenn Research Center termed Buildings 500 and 501 and the 9.8 acres of property on which they sit.
“Generally speaking, these (auctions) are open for several weeks before we announce a closing date,” Balsano said. Because the NASA property is among the larger ones the GSA auctions off, it may require more exposure time, he added.
While no timetable has been set, Balsano expects the closing date to be sometime in the fall.
If no bids are received, Balsano said the GSA would likely analyze the marketing of the property and offer the property for auction again, but possibly with a lower minimum bid.
City officials have been anxious to have the property turned over to a developer. They’ve repeatedly expressed their concern that the buildings will remain vacant for an extended period of time, denying the city much-needed income tax revenue. At one time, NASA employees and contractors who worked in Buildings 500 and 501 contributed more than $800,000 to the city in income tax.
“GSA really needs to close this out soon and get on with confronting the question of what they will do next,” Fairview Park economic development Director Jim Kennedy told West Life. “Otherwise, a repeat of this process will likely lead to similar results and the property will continue to languish.”
City officials had advocated the sale of the buildings to Hemingway Development, a division of Geis Cos., which had plans to redevelop the site. Fairview Park also sought to obtain the property for $1 and transfer it to Geis for redevelopment.
Kennedy had said the GSA’s reported valuation of $2.5 million for the property was far too high given current market conditions and the environmental remediation work required in the buildings. In addition, he said the office buildings are outdated and would need to be remodeled if retained.
“The sale price of $2,500,000 remains too high, although their ‘opening bid’ number of $200,000 may indicate they are willing to take less,” Kennedy said last week. “The question is, how much less?”
The GSA document listing the property states asbestos-containing materials have been detected “in pipe fittings, floor tiles and mastic, ceiling tiles, building paper, fiberglass ducts, hard plaster, window caulk, and drywall joint compound at the subject property.”
Balsano said asbestos issues are very common in commercial buildings.
“Properties with asbestos in them trade on the market every day,” Balsano said.
Kennedy said a NASA facilities manager recently said that the amount of asbestos in the building is mostly below the 1 percent threshold requiring removal, so remediation costs could be substantially less than previously anticipated.
Kennedy also expressed concerns about the $500,000 escrow deposit required of the winning bidder in order to sever the buildings from NASA Glenn’s electrical utility system and connect to an independent power source.