Redwood Trust fails to sell at auction; downgraded to $800K
Redwood Trust, the historic downtown building that housed mega-club Palma and now Dubai/Velvet Rope, failed to sell at auction last week.
The building at 200 E. Redwood St., which had a starting bid of $1.2 million, received 11 registered prospects, according to Leo McDermott, who was handling the sale.
But, the offers were not acceptable to owner Nicholas Piscatelli.
Piscatelli has now extended the online auction by 30 days and slashed the starting bid to $800,000.
It's a dramatic retreat for the developer, who spent $2.5 million to renovate the building in 2000 and has been trying to get rid of it since 2004, when it was listed at $3 million.
When Piscatelli bought the building in 2000, the former home of the Mercantile-Safe Deposit and Trust Co. branch, a beauty over 100 years old that is listed in the National Register of Historic Places, had been abandoned for years.
His restoration received incredible attention, including several laudatory stories from this paper, and was deemed a turning point for downtown development.
But since his megaclub Redwood Trust closed in 2004, Piscatelli has tried unsuccessfully to unload the building. While he's been trying to sell it, several tenants have filled out the space, including Palma and later the Velvet Rope and Dubai.
The $1.2 million he asked for last week had already cut the initial asking price in half. Now, the initial bid has been cut by $2.2 million, nearly as much as the developer spent to renovate the building.
McDermott insisted the first online auction gave the auction national exposure. But that the ownership has extended the auction "in hopes of generating more interest and competition." The property is listed at the Freedom Realty Exchange.
Photo: a party at Redwood Trust in 2003 (John Makely/Baltimore Sun)