June 25, 2011 in Business

Condo owners face tax bill

Notice of foreclosure filed on historic Kempis Building; delinquent taxes total $104,000
By The Spokesman-Review
 
Map of this story's location

Owners of 14 condos in the historic Kempis Building in downtown Spokane face a bill of $104,000 for delinquent taxes, according to a notice of foreclosure filed in Superior Court.

The building at Sixth Avenue and Washington Street, which opened in 1906, was converted into 25 condos by previous owners. The current owners, Kempis Group LLC, face foreclosure on the 14 units that are either unsold or owned by residents unable to pay the taxes, said the building manager, Steve Elliott.

The remaining unsold condos are not currently for sale and are being leased out as apartments, Elliott said.

“We’ll put them back on the market once the banks start dealing with condos again,” Elliott said.

The price range before the market tanked was $275,000 to about $105,000, he noted.

Elliott said the Kempis partners will be asked to invest the money needed to cover the taxes.

“That will happen in 30 to 60 days,” said Elliott, adding he is not a partner in the LLC but is part owner of one of the Kempis condos.

Elliott said he didn’t have the “authority” to divulge the names of the LLC partners.

The Kempis was originally an apartment building for well-to-do Spokane residents. From 1997 to December 2001, it was converted from apartments into the luxury Kempis Hotel.

From 1998 to 2001 the hotel owners also opened a restaurant there, the Winged Lion, with dinners costing a fixed price of $65.

The conversion to condominiums began in earnest starting in 2003, first by owners Sarah and Michael Michalko, and then with investment partners Julie and Ron Wells.

The Michalkos and the Wellses sold out in 2007 and 2008, with Kempis Group taking over. At the time, Ron Wells said he sold out because he had enough other condos for sale.

Wells said the situation for condos in Spokane mirrors that found in many cities. More condos were put on the market than the demand justified, he said.

Would-be buyers – for almost any Spokane condo – now confront serious challenges obtaining financing, Wells said.

“But the situation in Spokane is that we’re not as overbuilt as other areas,” Wells added.


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