100 acres at Village at Sandhill could head to auction block
12/05/2013 10:09 PM
12/05/2013 10:11 PM
A third of the sprawling Village at Sandhill on Clemson Road in Northeast Richland will go up for auction next week, unless more than $500,000 in back taxes is paid Friday.
The 2012 taxes are owed on two pieces of vacant land behind the Super Bi-Lo, according to court records. Unless a guaranteed form of payment for the tax balances is made by 5 p.m., the properties are destined for the public auction block Monday or Tuesday, county officials said.
The auction is another blow to Columbia developer Alan Kahn, a major Southeastern shopping center developer who has said he considered the 300-acre lifestyle center – with shops, restaurants and condos – to be his proudest accomplishment. Kahn filed for bankruptcy earlier this year and no longer owns the entire shopping center.
County records show more than $476,000 in taxes is owed on a 92.5-acre tract on Town Center Place and more than $35,000 in taxes is owed on two adjacent acres on Forum Drive.
To make matters worst, the 2013 tax notices on those two properties – totaling $372,000 – also have been mailed out and must be paid by Jan. 15 to avoid additional financial penalties.
Kahn declined comment on the delinquent tax situation or the fate of the property.
Commercial banker TD Bank said it has a loan out on the delinquent tax parcels at Village at Sandhill, but noted it is the owner’s responsibility to pay the property taxes.
A successful bidder would have to come to the auction armed with a minimum of about $900,000 in liquid assets, Richland County Treasurer David Adams said, to cover both the 2012 delinquent tax bill on both parcels and the current 2013 tax bills due in January.
The bidder would then have no legal rights to the Village at Sandhill property for 365 days, he said.
“I think that if someone owns a business a long period of time, economic ups and downs are going to catch you, and it’s not unheard of at all for you to need a little extra time to pay your taxes,” Adams said.
Kahn, president of Kahn Development Co., still appears to be reeling from the ravages of worst recession since the Great Depression 80 years ago.
Kahn, now 73, started building the Village at Sandhill in 2004, quickly opening a variety of stores and restaurants, including anchors Belk, JCPenney and The Home Depot. He once proposed a minor league baseball stadium surrounded by condos and office buildings for the site, but the plan, which called for taxpayer subsidies, fell apart without support from Richland County Council.
Kahn moved forward, unveiling 160 new condos in late 2007 – just as the economy was beginning to crash, led by an epic real estate bust. He eventually rented the condos as financing dried up for many potential buyers.
However, he struggled to gain new retail tenants during the depths of the recession and its ongoing aftermath.
Kahn, filed for Chapter 11 protection from his creditors in U.S. Bankruptcy Court in Columbia in April, where he declared his two real estate companies, Kahn Family LLC and Kahn Properties South LLC, owed up to 50 creditors as much as $250 million.
The court gave Kahn until Oct. 21 to file a plan with the court to begin repaying those creditors, but his attorneys asked the court in November for a time extension. The new date for filing the repayment plan is Dec. 21, according to court papers.
Kahn also declined to comment on the bankruptcy proceedings.
Village at Sandhill’s latest tax dilemma is not its first. In 2010, Kahn fell behind in taxes to the county by $1.2 million.
At the time, Kahn pointed to the poor state of the economy, noting the breadth of the Great Recession had led three of the center’s large retailers to file for bankruptcy protection, and that a cadre of the 118 tenants who occupied retail space in the center had become slow in paying their rents.
Kahn eventually paid the $1.2 million late portion of the 2009 taxes he owed on Village at Sandhill seven months late, incurring a 15 percent penalty.
Taxpayers as a group, by and large, are not hurt by tax delinquencies, treasurer Adams said. They will be paid either when the property sells or will be paid late with penalties.
Overwhelmingly, delinquent taxpayers whose property goes to a tax sale, eventually end up redeeming their property and holding on to the title, he said. Only about one-tenth of Richland County tax delinquencies end in a change of ownership, Adams said. Either way, the county is not going to lose out in the process, he said.
“Taxpayers should not necessarily be worried that something is paid late,” Adams said. “The county is going to get the money to be able to fund the police and the schools and everything else.”
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