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As the commercial real estate market continues to show signs of opportunity, the auction is once again gaining popularity for the sale of companies and real estate.
An example can be found with William A. McEnery, son of William J. McEnery, one of Chicago’s most well-known entrepreneurs, and former Gas City owner: McEnery announced he will auction off the successful Creamery Restaurant portfolio.
Never before on the market, the seven operating locations will be sold at auction on Tuesday, April 7, at 7 p.m. The gavel will fall at the Double Tree Hilton, located in Alsip, Ill., at 5000 W. 127th St.. Registration for bidders begins at 6 p.m.
The first Creamery location was opened in 1981 in historic downtown Frankfort. However, most restaurants are under 10 years old. The Creamery is known for its soft serve ice cream and hot dogs, but all stores offer a plethora of menu options. The company grew to seven locations and was eventually acquired by WAM operations.
Illinois locations include Orland Hills, Homer Glen, Frankfort, Manteno, Mokena, Manhattan and New Lenox. Stores offer drive thru’s and inside and outside seating, and cater mostly to families, which drives volume.
According to Frank Diliberto, of Chicago-based Diliberto Real Estate Services, the firm that has been hired to conduct the sale, “The investment opportunity includes all business assets and operations, with a solid return as it stands. However, due to the extraordinary locations and land flexibility, the stores are suitable for franchises or private operators to easily expand, by brand integration.”
“Expansion was next on the agenda,” according to William A. McEnery. “But there is a fork in the road for me, and it’s time to let someone else pick up where I left off. I am pursuing my personal goals in the capital markets arena, beginning June 1. But I would love to see the new owner continue or expand this long-standing operation. Our customers love this place.”
In a trend of “online auctions,” most real estate investors insist that a live auction event still creates the most comfort for them. According to the terms of this sale, that’s exactly how the auction will be handled; in a traditional live open bidding format, with opening bids at a fraction of value.
A very good investment opportunity is found through the auction process, but the auction firm warns there is an accelerated process that must be met by the bidders. Terms provide for selected dates to inspect the properties and meet with auction representatives to hear a presentation, a cashier’s check to enter as a bidder and a contract that offers no contingencies.
So buyers need to prequalify prior to auction. According to Diliberto, “Full bid packages provide substantial due diligence, making the review of documents much faster than the conventional due diligence process, where buyers sometimes have to chase down information over months.”
Closings provide for 45 days. However buyers receive discounts for faster closings, saving as much as 2 percent to do so. Cost of admission to bid? A cashier’s check for $25,000 is required for each property purchased at the auction.
Interested bidders are encouraged to obtain a full bidder’s package, including the terms of sale, financials and contracts, by calling 855-460-(bids) 2437. Bidder’s seminars begin in March.
Diliberto Real Estate Services, LLC is a global leader in Real Estate Advisory and Auction Services, with transactions across America and selected global markets. Based in Chicago and Palos Heights, IL, services range from real estate and finance advisory work, to loan and real estate auctions. Solutions also include new capital formation to expand or reduce debt.
