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VOL. 124 | NO. 150 | Monday, August 3, 2009

Pat O’s Sold Back to Bank

By Eric Smith

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A mini bidding war broke out Friday during the trustee’s sale of the former Pat O’Brien’s bar at 310 Beale St., but in the end the bank that foreclosed on the property came in with the highest bid of $827,000.

Performa Entertainment Real Estate Inc. and Loeb Properties made four bids each on the southwest steps of the Shelby County Courthouse in hopes of obtaining the 13,000-square-foot club that stands at the corner of Beale Street and Rufus Thomas Boulevard.

Performa is the management company that has the contract to develop and manage the Beale Street Entertainment District. Loeb is a longtime Memphis firm that owns and manages a large commercial portfolio in the Mid-South.

Highest bidder

Loeb opened the bidding at $250,000, which Performa countered at $350,000. The two entities – Al James representing Performa and Earl Williams representing Loeb – took turns by upping their bids in $10,000 and then $50,000 increments until Performa offered $550,000.

That’s when Loeb declined to make another bid, and when R. Spencer Clift III – an attorney from Baker Donelson Bearman Caldwell & Berkowitz PC and substitute trustee in the matter – made a bid of $827,000 on behalf of Wachovia Commercial Mortgage Inc.

Wachovia is the entity that foreclosed on the former owners, 310 Beale Street Properties LLC and Hurricane Memphis LLC, which had defaulted on a $2.6 million loan dated Dec. 20, 2001.

Clift didn’t comment on the bank’s plans for the property, only to say that Wachovia likely would begin looking for a buyer to acquire it at market rate.

The sale included all “personal property owned by 310 Beale Street Properties LLC and Hurricane Memphis LLC,” such “all machinery, equipment, furniture and fixtures,” except Pat O’Brien’s proprietary items.

Background

The sale back to Wachovia closes another chapter in a long-running saga involving Pat O’Brien’s and 310 Beale St.

The Downtown restaurant and bar opened on Beale in the fall of 2002 after a lengthy process to bring a Memphis version of the New Orleans nightspot to town. At the time, the Memphis restaurant was Pat O’Brien’s first franchise.

The Memphis establishment, which has 3,000 square feet of patio space in addition to its 13,000-square-foot interior – is a replica of the New Orleans establishment and its signature layout that features multiple bars, wrought-iron railings and a piano bar. The original Pat O’s opened in New Orleans in 1942 and is famous for “Hurricane” mixed drinks.

The Memphis locale went into foreclosure in April 2008. Hurricane Memphis LLC filed a Chapter 11 bankruptcy petition a month later, just ahead of the scheduled foreclosure sale. Pat O’Brien’s closed four months later.

And just last month, a federal bankruptcy judge denied plans to open a new hip-hop nightclub at the location as Liquid on Beale. The plan was proposed by Cato Walker and Curtis Givens, who founded the former Premier Club on American Way.

See the June 16 issue of The Daily News and the May 30 issue of The Memphis News at www.memphisdailynews.com for more on the court ruling and the brief but tumultuous story of 310 Beale St.

RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 88 88 7,923
MORTGAGES 119 119 8,904
FORECLOSURE NOTICES 5 5 1,133
BUILDING PERMITS 253 253 17,320
BANKRUPTCIES 42 42 5,201
BUSINESS LICENSES 35 35 3,417
UTILITY CONNECTIONS 30 30 2,298
MARRIAGE LICENSES 25 25 1,617