Bidding competition strong at Luzerne County’s latest back-tax auction

Hungry bidders left little on the table at Luzerne County main annual free-and-clear delinquent tax auction last week, a post-auction report shows.

The auction generated $1.08 million, with 86 parcels selling and 25 with no bids, according to the report from county tax-claim operator Elite Revenue Solutions LLC.

Evidence of the popularity of county tax sales can be seen in the competition — 64% of the purchased properties attracted multiple bidders, driving purchase prices above the minimum bid. The others sold for the starting bid amount.

Formally known as a judicial sale, the auction held Thursday sells properties cleared of liens and back taxes because they were not purchased at a first-stage upset sale. As a result, the starting bids are set at lower amounts to recoup only the tax claim costs to bring the parcels to auction.

The two highest prices paid in this sale were for double-block residential properties in Wilkes-Barre.

At the top, bidder Esthanli Duval Ferrera, of Paterson, New Jersey, paid $135,000 for a double-block listed at 60-62 Mill St. in the city, records show.

Bids started at $2,683 for this property. Because the purchase price far surpassed that amount, taxing bodies will still recoup the $24,217 in delinquent real estate taxes that had accrued on the property.

The second highest purchase was $127,000 for a double-block at 29-31 E. Main St. in the city, which was purchased by bidder Hansen Cabrera Coronado of Wilkes-Barre, records show. Bids had started at $6,922.

Freeland commercial property

Bidder Nabil Abualburak, of Kingston Township, paid the third highest amount at the auction — $125,000 — for a large vacant commercial structure along busy Route 940 in the borough.

Most recently, PGA Incorporated operated a plastic recycling operation there. However, the building was most known for housing Garland Commercial Industries, which made commercial ovens, grills and counter-top cooking equipment for restaurants, hotels and institutions. Garland’s corporate owner announced the business closing in 2010, citing consolidation plans and the poor economy.

Abualburak and another unidentified man with him at the auction said they are investors under the umbrella of 185 South Street LLC.

The men said the property will be cleaned up and leased or sold, with storage units mentioned as a possible use.

After Abualburak completed paperwork following the winning bid, another tax sale buyer/real estate investor Raymond Slack approached Abualburak to alert him to building issues with the Freeland property.

Slack said he had been interested in the property but backed away after speaking with a borough official about the deteriorated condition of the property and other concerns, including a large quantity of hazardous material that must be removed.

Wilkes-Barre restaurant/bar

Slack, of White Haven, paid the fourth highest amount at the sale — $91,000 — to purchase a restaurant/bar at 650 Main St. in Wilkes-Barre that had operated as Outsiders Bar in the past and is now Uncle Jesse’s.

A Plains Township woman had submitted the winning bid of $164,000 to purchase that property at last year’s free-and-clear auction, but that purchase did not go through due to a problem with the payment. That’s why it was listed again in this year’s auction, with a $7,991 starting bid.

While Outsiders Bar had been in the news for criminal activity, Slack said he has been encouraged by the online reviews of food served at Uncle Jesse’s.

“I think in the last year or so it’s been kind of changing its image,” he said.

Slack said he will ensure the building is properly maintained and attempt to work out a rental agreement with the current restaurant/bar management.

“It’s an existing, thriving business, and I plan to not change much,” said Slack, who purchases 10 to 15 distressed properties from tax sales in multiple counties annually through his company, RCS Capital Group LLC.

Single family residences

In another larger-ticket buy, bidder Kristy Latimer, of Forty Fort, purchased a house in Plymouth Township for $58,000. Bidding started at $2,774 for the property listed at 35 Maude St.

Bidder Karina Broes, of Randolph, New Jersey, submitted the winning $40,000 bid for a house at 1367 Old Tioga Turnpike in Huntington Township. Bidding started at $1,264.

Richart Ferrira, a bidder from Macungie, obtained a house at 53 Main St. in Salem Township for $24,000, with bids starting at $1,424, tax-claim records show.

Land banks

Separate from purchased through competitive auction bidding, two land banks acquired a total 18 properties through their trump bid authority, which removed the properties from the sale.

Authorized by 2012 state legislation, land banks take possession of rundown parcels and attempt to get them back into productive hands. With trump bids, land banks have authority to acquire the free-and-clear sale properties by paying the starting bid.

The properties were acquired by the Lower South Valley Land Bank and North East Pennsylvania Land Bank Authority.

Elite Revenue Attorney Sam Falcone conducted Thursday’s auction and cautioned bidders in advance they should not enter or make improvements to their acquisitions until the deed is recorded.

Falcone said there is a window in which sales can be contested, which in rare instances could result in a judge voiding a sale. If that occurs, the bidder would receive a refund of the purchase payment, but refunds are not provided for any pre-deed work bidders complete on properties, he said.

Deeds are usually issued within 60 days of the sale.

Information on county tax auctions is available on Elite Revenue’s site at luzernecountytaxclaim.com.