The landmark Van Dyck Restaurant & Brewery will be up for auction July 2, according to attorneys. The Stockade music club has been in foreclosure for the last year.
Bankruptcy referee Roland Faulkner said the auction will include the building at 235-237 Union St. and a parking lot a block away as one parcel. Berkshire Bank, which initiated the foreclosure last year, will set the minimum auction price, he said.
Owner N. Peter Olsen defaulted on a $250,000 loan from Berkshire and a $200,000 loan and $75,000 line of credit from the Metroplex Development Authority in early 2007. Olsen did not return a phone call for comment on Monday.
Both Berkshire and Metroplex expect to recoup the amounts owed them, said Metroplex Chairman Ray Gillen. “Our $275,000 is fully secured by equity in the property,” Gillen said.
The building is valued at more than $1 million, while the parking lot has a value of at least $100,000.
Gillen said several people have contacted Metroplex with an interest in the Van Dyck property and plan to attend the auction. He expects a new owner to reopen the business in some form.
Metroplex owns the Van Dyck name, acquired as collateral for the loan it gave Olsen in 2005. Gillen said Metroplex is willing to negotiate the use of the name with the new owner. “We will work with any buyers who want to use it in some form,” he said.
Metroplex signed a 10-year lease agreement worth $100,000 with Olsen in 2005 to use the parking lot. Metroplex would lose control of the parking lot through the auction. Metroplex does not expect to recover the $100,000, Gillen said.
Gillen said Metroplex will work with the new owner to lease the parking lot for the nearby Gillette Center. The Chamber of Schenectady County needs the parking space for a proposed mini-convention center to be built there, using the restored Gillette House.
Olsen shut down the former jazz club in March 2007, saying he planned to close temporarily for repairs. He never reopened and shortly thereafter put the Van Dyck up for sale. He initially listed it at $1.6 million and is now seeking $1.48 million.
State Supreme Court Justice Vincent Reilly Jr. appointed Faulkner to oversee the foreclosure, granting summary judgment in November 2007 to Berkshire Bank.
Gillen said Olsen can avoid foreclosure any time prior to July 2. All he has to do is pay off the loans to Berkshire and Metroplex, he said.
Olsen filed for Chapter 11 personal bankruptcy protection last year, hoping to restructure his debts and reopen the Van Dyck.
In March, U.S. Bankruptcy Court Judge Robert Littlefield dismissed Olsen’s petition. He based his decision on creditors’ mounting complaints that Olsen lacked the financial resources to restructure what they called a “non-existent business.”
Olsen is now facing foreclosure on his home in Saratoga Springs and on another business he operates in Washington County.
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Categories: Schenectady County