Auction of Marquette Tower halted -- for now

A planned public foreclosure auction of the Marquette Tower and Centre buildings was postponed Friday.

The two downtown Cape Girardeau properties were set to be offered to cash bidders on the steps of the Common Pleas Courthouse.

But an attorney for the Springfield, Missouri, bank that holds the note on the properties announced a one-week continuance instead while a potential sale is evaluated.

"The owners of the property have indicated that they have pending negotiations for the sale, and it is to give them another week to see if those negotiations result in anything," said Nancy Browne of The Limbaugh Firm, who is acting on behalf of Great Southern Bank.

G&S Holdings LLC owns the two buildings, which were bought from the bank in 2009 for between $3 million and $4 million.

The company has faced financial hardships in recent years after a former managing partner, Richard T. Gregg, faced federal criminal charges for fraud and embezzlement.

A company representative also said last week the move of state offices from the Marquette Tower building caused additional financial struggles for the company and left it unable to make payments on the loan. If a deal can be reached with a buyer, the foreclosure auction set for 1:30 p.m. Friday at the courthouse will be canceled. No official public notice of the sale's cancellation will be given, Browne said.

The Marquette Tower building at 338 Broadway originally was the Marquette Hotel, built in 1928.

The Marquette Centre, at 221 N. Fountain St., was a printing and shipping facility for Southeast Missouri State University.

Both buildings underwent a multimillion-dollar restoration and renovation in the early 2000s. The money came mostly from historic tax credits handed down by the state.

A local agency, Lorimont Place Ltd., has the Marquette Tower listed for sale at $3.5 million and the Marquette Centre building listed for $549,000.

Parties involved in the foreclosure proceedings said last week they were unsure whether anyone would show up at the Friday sale because there was a question of whether it would go on as planned.

Browne was the only person present at the courthouse Friday, where she made the announcement of the continuance.

G&S Holdings filed a lawsuit against Great Southern Bank in late December that contained an injunction in an attempt to halt the foreclosure auction. The suit also asks the court not to enforce the real estate contract with the bank and declare the note, deed and guarantees canceled, in part because the company alleges the bank pressured Gregg to buy the buildings.

Browne said last week the suit, unless a court order was handed down, wasn't enough to stop the public foreclosure sale. The case is set to be reviewed in May.

The bank bought the buildings in a foreclosure sale in 2008 before selling to Gregg's company and financing the loan.

The properties previously were owned by Prost Builders, a Jefferson City, Missouri, company, that oversaw the renovations. The Marquette Tower building had been vacant more than 20 years and condemned by the city when Prost Builders bought the property in 2002 for $350,000.

As is the usual process in a foreclosure sale, the note holder -- in this case, the bank -- submits a bid, so if no other bids are received, the holder immediately retains the property. The bank already had submitted its bid Friday morning, but through Browne declined to release the amount.

Brian Hayes, a representative of G&S Holdings, said last week the company hoped for more time to sell the buildings on its own and had prospective buyers.

"It's kind of one of those issues where this isn't a big evil bank wanting to come in and take over. They're looking after their best interests; we are also looking after our best interests," he said.

eragan@semissourian.com

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