The foreclosure market in the United States is not limited to just homes and other residential structures. While the majority of foreclosures are residential foreclosures – as evidenced by the massive residential backlog and inventory we are currently witnessing – there are plenty of industrial and commercial foreclosures on the market.
What’s more is that there are common themes running through each sector that are indicative of the economic woes that have befallen the entire country and large swathes of the global community itself.
There is a particularly interesting case happening in Rhode Island that has a lot in common with residential and commercial foreclosures going on currently. In Providence, there is a 27-acre chunk of land that is being sold at a foreclosure auction this upcoming week in order to obtain a clear title to the property. The mortgage – originally worth $1.77 million in 1987 – is now worth $2.17 million but has a pretty murky history of ownership.
British Petroleum (now known as BP) originally bought the land at Kettle Point, Rhode Island to use as an oil storage facility in the 1980’s. It stopped using it for that purpose and sold it to two developers, who attempted to use the facility for other purposes and develop the land. Neither development worked, and now the current owner is being foreclosed by a BP subsidiary company in the States.
If that doesn’t sound familiar, the bank that held the original mortgage – Eliot Savings Bank of Boston – failed in 1990, sending the entire process into a web of confusion and entanglement that still exists. So much, in fact, that the reason the property is being foreclosed is simply to clear the title. The previous owner walked away from the project and nothing is currently being developed at the site at all.
What makes things worse is that the site, which has sat vacant for over 20 years, still has to have ‘environmental remediation’ before it can be developed at all.
This case goes to show just how complex, confusing, and involved the real estate market has become, not just with industrial properties but also with residential foreclosures. This means even more opportunity exists for investors who want to take advantage of the mess and walk away with property for pennies on the dollar.
Follow us:
Written by Alex Rolim.
