Make us your home page
Instagram

Channelside auction might not be won by highest bidder

Jeff Vinik’s CBP Development presented its “Channelside Live” plans Monday.

Jeff Vinik’s CBP Development presented its “Channelside Live” plans Monday.

TAMPA — It will take more than a big, fat check to win Channelside Bay Plaza in today's auction.

The winning bidder will also have to prove it has the best shot of succeeding as Channelside's new owner.

In bankruptcy law, the concept is called "adequate assurance of future performance." It will play a key role in determining who will control Channelside.

The auction will start at 10 a.m. at a New York law firm. Three parties will bid against one another: Tampa Bay Lightning owner Jeff Vinik's group CBP Development LLC, which unveiled its grand plans for Channelside on Monday; Liberty Channelside LLC investors Santosh Govindaraju and Punit Shah, who tried to buy it last year and have since been in litigation; and the Tampa Port Authority, which wants to choose the complex's savior.

The first part of the auction will focus on bid price. Vinik's CBP Development turned in the highest starting bid, $7.1 million. That's $100,000 more than Liberty's $7 million bid. The Tampa Port Authority's bid is $5.75 million, but it can spend up to $15 million if necessary.

The second part of the auction is more complex. Channelside is an asset of the Irish Bank Resolution Corp., which is being liquidated. The bank's liquidators and the firm running the auction, DJM Real Estate, must determine what bidder has the best chance of "adequate assurance of future performance" — in short, who has the means and the money to fix Channelside.

That's because whoever wins the auction also inherits the contracts regulating the property. A contract with the Tampa Port Authority, which owns the land under Channelside, calls for its owner to run a "first-class retail and restaurant facility."

"It's designed to assure that the person coming into the contract has a good chance of actually being able to fulfill the contract," said Stetson University College of Law professor Theresa Pulley Radwan.

After the auctioneers have picked the winner, a bankruptcy judge will have to approve the result at a July 15 hearing.

A real-world example of how complicated a bankruptcy auction can be is the recent battle in Baltimore for control of 1st Mariner Bank. At first, National Penn won the auction with a bid of $13.7 million, according to the Baltimore Sun, though that offer was $150,000 less than what RKJS Bank bid. But 1st Mariner's auctioneer chose the low bidder, according to the Sun, because it believed National Penn was more likely to get approval from regulators. RKJS challenged the auction in court and eventually won control of 1st Mariner by raising its bid to $18.7 million, striking deals with creditors and getting regulatory approval.

Liberty has signaled it is willing to challenge the Channelside auction in court.

But the Vinik group enters with a big advantage: After unveiling its "Channelside Live" plans Monday, the Tampa Port Authority voted to start negotiating a lease with Vinik's CBP Development. The port believes it has veto power over any sale of Channelside, and according to the auction rules, getting the port's approval would be a big plus for the eventual winner.

And if the port wins the auction, it can sign a development deal for Channelside with anyone it wishes, including Vinik.

Times researcher John Martin contributed to this report.

Channelside auction might not be won by highest bidder 07/01/14 [Last modified: Tuesday, July 1, 2014 9:01pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. Federal agencies demand records from SeaWorld theme park

    Tourism

    Associated Press

    ORLANDO — Two federal agencies are reportedly demanding financial records from SeaWorld.

    Killer whales Ikaika and Corky participate in behaviors commonly done in the wild during SeaWorld's Killer Whale educational presentation in this photo from Jan. 9. SeaWorld has been subpoenaed by two federal agencies for comments that executives and the company made in August 2014 about the impact from the "Blackfish" documentary. 
[Nelvin C. Cepeda/San Diego Union-Tribune/TNS]
  2. Legalized medical marijuana signed into law by Rick Scott

    State Roundup

    TALLAHASSEE — Gov. Rick Scott on Friday signed into law a broader medical marijuana system for the state, following through on a promise he made earlier this month.

    Gov. Rick Scott signed legislation on Friday that legalizes medical marijuana in Florida.
  3. Line of moms welcome Once Upon A Child to Carrollwood

    Business

    CARROLLWOOD — Strollers of all shapes and sizes are lined up in front of the store, and inside, there are racks of children's clothing in every color of the rainbow.

    At Once Upon A Child, you often as many baby strollers outside as you find baby furniture and accessories. It recently opened this location in Carrollwood. Photo by Danielle Hauser
  4. Pastries N Chaat brings North India cuisine to North Tampa

    Business

    TAMPA — Pastries N Chaat, a new restaurant offering Indian street food, opened this week near the University of South Florida.

    The menu at Pastries N Chaat includes a large variety of Biriyani, an entree owners say is beloved by millions. Photo courtesy of Pastries N Chaat.
  5. 'Garbage juice' seen as threat to drinking water in Florida Panhandle county

    Water

    To Waste Management, the nation's largest handler of garbage, the liquid that winds up at the bottom of a landfill is called "leachate," and it can safely be disposed of in a well that's 4,200 feet deep.

    Three samples that were displayed by Jackson County NAACP President Ronstance Pittman at a public meeting on Waste Management's deep well injection proposal. The sample on the left is full of leachate from the Jackson County landfill, the stuff that would be injected into the well. The sample on the right shows leachate after it's been treated at a wastewater treatment plant. The one in the middle is tap water.