Church’s foreclosure salvation is short-lived

The Richmond Christian Center building at 214 Cowardin Ave. (Photo by Burl Rolett)

The Richmond Christian Center building at 214 Cowardin Ave. (Photo by Burl Rolett)

A Southside house of worship is headed toward another foreclosure weeks after a last-minute bankruptcy delivered the church from a trip to the auction block.

The Richmond Christian Center at 214 Cowardin Ave., near Manchester, is set to be sold by its lender at foreclosure auction Nov. 22. The church’s congregation was locked out of its 77,000-square-foot building Thursday, said Ron Page, an attorney representing the Christian Center.

“As of today, [the lender] has used an ex parte proceeding to lock my client out of the facility and effectively prevent them from going forward with their ministry,” Page said. “That was without notice – it went on behind closed doors.”

Foundation Capital Resources, a Mississippi-based lender and REIT that specializes in financing for churches, is foreclosing on the property after the center defaulted on a $4.4 million loan issued in September 2005.

The lender attempted a foreclosure in late September, but the Christian Center filed for Chapter 11 bankruptcy, putting the brakes on the auction and buying time for the church to try to work out financing on the loan.

But the church’s shelter under bankruptcy protection was lifted in October when a judge dismissed the case for failure to file the proper documents.

Page was unaware of the scheduled foreclosure auction as of Thursday morning. He said his first notice of the situation at the property came from parishioners who could no longer access the building.

A message left on the Christian Center phone line was not returned by press time.

Paul Campsen, a Kaufman & Canoles attorney representing the lender in the foreclosure process, did not return a phone message seeking comment.

When it filed bankruptcy in September, Page said the RCC owed slightly less than $2 million on the loan.
“The strategy was to find a new lender or some new financial arrangements where they could continue an occupation and enjoyment of the facility, and those efforts are ongoing,” Page said.

The RCC’s Chapter 11 filing listed between $1 million and $10 million is assets, with liabilities in the same range. Foundation Capital Resources was the only creditor listed in the filing.

The main Christian Center building is being marketed for sale or lease, along with several separate RCC-owned parcels. Cushman & Wakefield | Thalhimer brokers John Myers and Isaac DeRegibus are handling the listing, although DeRegibus said the latest foreclosure proceeding makes the firm’s future involvement with the property uncertain.

DeRegibus said the building would likely return to the lender if it goes to foreclosure this month because developers will not be willing to pay the full asking price at auction.

“It’s a really cool and interesting property. It has a lot of great attributes,” he said. “It’s going to take the right buyer though, and it’s a very small and narrow gauge of people that can use the existing improvements.”

DeRegibus said the building would likely draw considerable interest after an auction, however, should Foundation Capital Resources take the property back.

David Lanetti and Christopher Stuart Colby of the Norfolk-based law firm Vandeventer Black are acting as substitute trustees.

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