Two of Spokane’s well-known but cash-strapped buildings concluded foreclosure sales today, shutting the file on separate cases of large commercial properties falling victim to a distressed real estate market.
The 17-story Wells Fargo Tower at 601 W. First Ave. and six-level Holley Mason Building at 157 S. Howard St. both formally changed hands, culminating two separate bank repossessions due to previous owners unable to pay off their loans.
Inland Northwest Health Services took over about three-fourths of the Wells Fargo building; in 2009 it acquired roughly one-fourth of the building when previous owner Prium Spokane Buildings sold that portion for $9.4 million.
At Friday’s sale INHS officially took over the remainder of the 184,000-square-foot tower for slightly more than $16.1 million, said John Craig, INHS chief financial officer. Until July of this year, Prium Spokane Buildings was the building owner.
But in 2010 Prium filed for bankruptcy, effectively ending its loan repayments to its creditor, Sterling Savings Bank.
INHS is an independent medical services provider that works with area hospitals and providers as well as running St. Luke’s Rehabilitation Institute and other services. It was formed in 1994.
Craig said the INHS board has no plans to sell the Wells Fargo building or portions of it in the near future. Since 2006, INHS has been using the building, and now it’s the largest tenant there. The second-largest tenant is Wells Fargo Bank, Craig said.
Chris Bell of NAI Black brokered the deal for the Wells Fargo Tower.
While Wells Fargo building owner Prium Spokane Buildings filed for bankruptcy in December 2010, Holley Mason owner, Spokane developer Rob Brewster, did not.
Brewster said diminishing revenue from Holley Mason tenants left him unable to pay off the loan to Prudential Financial and he decided to let the bank, Prudential Financial, repossess and sell it.
The buyer of the historic Holley Mason was C3 Realty, which paid roughly $5.2 million to Prudential. C3 Realty, based in New York, is a national firm that acquires and resells distressed properties.
“Sadly, that’s the kind of market Spokane has right now,” he said. “If you started out buying any (commercial) property after 2000, you’re probably now under water” as the real estate market has sunk, he said.
Brewster said he didn’t file for bankruptcy because a default on the contract with Prudential opened the door to claims against his retired parents’ personal assets.
Attempts to reach C3 for comment were unsuccessful.