Creditors hold on to General Wayne property after public auction

07/17/2013 4:00 PM |

TIM KELLY FILE PHOTO | The collapsed remains of what once was the General Wayne Inn in Southold, in a 2011 photo.

The General Wayne Inn property will remain in the hands of its creditors after the finance company waived off multiple lowball offers during a public auction Tuesday.

Bidding started at $55,000 and reached a maximum of $70,000 before the mortgage holder, Liquidation Trustee Services, ended the bidding with an offer of $1.8 million, the amount owed on the property.

“When they saw the bids were not going to get to the point they were willing to accept they called off the bidding,” said town assessor Bob Scott, an auction spectator. The bidding began at Town Hall a half-hour earlier than scheduled, to the frustration and confusion of dozens who arrived at the noted time.

“If they are really trying to sell it you’d think they’d be on the up and up about it,” said Kathy May, who lives next to the property. “I just wanted to know who my neighbor was going to be. It’s ridiculous.”

During a June 4 Town Board meeting, company representative Michael Tsandilas told officials that several interested parties had lined up to purchase the once-popular inn, which dates back to the late 1700s and has fallen into extreme disrepair following years of neglect.

Earlier this year the Town Board declared the historic inn “unsafe and dangerous to the public in its current state.” The board said that following the auction the new owner would have 30 days to respond with a plan of action to make the structure safe or face violations.

Supervisor Scott Russell said Tuesday he wasn’t surprised by Liquidation Trustee Services’ gaining the title, but the company will be held accountable if a viable plan to secure the property isn’t presented to the town within 30 days.

“The bank is going to protect its interests,” he said. “Rarely is someone going to show up and bid more than the foreclosed amount. If we still don’t get resolution from the owner of record then we would undertake it ourselves and file it as a lien against the property.”

Mr. Russell said that if the General Wayne Inn comes into the town’s possession it will be demolished and the expense added to the last owner’s next tax bill.

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