Mike Carey, an auctioneer for Tranzon, discusses the terms of sale for a block of downtown Freeport before starting the bidding during the auction in the former Nordica Theatre on Wednesday. Ben McCanna/Staff Photographer

A factory outlet shopping center in downtown Freeport was sold for $20 million during a foreclosure auction at the complex on Wednesday.

Freeport Village Station Capital LLC, which held the mortgage on the shopping center, placed a $20 million credit bid on the site, buying the shopping center from Boston-based Berenson Associates. Only the mortgage lender is able to make a credit bid, which is typically for the outstanding amount of the loan.

Only one other bid was received, $5 million from an unidentified bidder. The buildings and land are assessed at about $32.5 million, according to the Freeport assessor’s office.

Preti Flaherty attorney Adam Shub, who represented Freeport Village Station Capital, would not discuss details of the purchase, citing confidentiality.

It is unclear what the outcome means for the future of the shopping center that takes up a 3.6-acre block along Main Street.

The complex, called Freeport Village Station, is home to outlet stores of L.L.Bean, Brooks Brothers, Old Navy, Oshkosh and other retailers. It also includes a parking garage with hundreds of spaces.


The auction, which ended about 20 minutes after it began, drew about 50 real estate agents, local business owners, financing specialists and curious onlookers who crowded the lobby of the shuttered Nordica Theatre, which is part of the center.

Standing before an empty refreshment stand, auctioneer Mike Carey, in the rapid-fire auctioneer’s speech, started the bidding at $30 million, dropping the price by $5 million increments until the unidentified bidder made an offer.

Carey, co-chief executive officer of Tranzon Auction Properties, paused the bidding when no higher offers emerged. He returned a few minutes later and said he was “instructed” to increase the bid price to $20 million. It settled there and the retail site was bought by Freeport Village Station Capital.

Asked if the $20 million sale price might affect the assessed value, Freeport Assessor Quang Le said the sale is one “data point” used to value the property.

A block of downtown Freeport was purchased for $20 million during an auction on Wednesday. Ben McCanna/Staff Photographer

A developer and real estate agent said the retail environment has been reshaped by online giants such as Amazon and high interest rates that have driven up borrowing costs.

Arthur P. Girard, of Delta Realty LLC, a Portland commercial real estate developer, said before the auction that he would watch, but ultimately did not bid. Shopping centers face intense competition from online retailers, he said.


“That’s the only thing that scares me,” he said before the auction.

He did not expect many bidders because of the “big dollars” involved in the purchase.

Brian DApice, principal at The Mega Group, a commercial and investment real estate firm in greater Boston, also watched from the sidelines.

Mike Carey, left, an auctioneer for Tranzon, with Adam Shub, a partner at PretiFlaherty, after Shub made the $20 million bid for a block of downtown Freeport during an auction at the former Nordica Theatre on Wednesday. Ben McCanna/Staff Photographer

“No one is lending,” he said, citing a five-year 6.3% interest rate charged by banks.

In addition, online competition for product sales have forced many of his tenants to instead offer services such as hair cutting and food sales, he said. Freeport Village is an exception, DApice said. “Specialty shops will never go away,” he said.



Prior to the auction, a notice of sale filed Feb. 5 at the Cumberland County Registry of Deeds indicated Berenson Associates was in breach of conditions of the mortgage. Records did not describe the nature of the violation, though a foreclosure is typically prompted by the borrower’s failure to make mortgage payments.

The company did not respond to an email Wednesday seeking comment on the auction.

Arthur Girard, a property owner in Portland, talks to other attendees at an auction for a block of downtown Freeport on Wednesday. Ben McCanna/Staff Photographer

Initial deposits of $250,000 were required of bidders. As the successful bidder, Freeport Village Station Capital could bid without making required deposits, modify the terms of the sale and add other terms, according to documents filed with the Registry of Deeds. Closing will be in 30 business days.

Freeport Village Station celebrated a grand opening in May 2009. The retail center was particularly welcomed as the Great Recession worsened.

Tawni Whitney, executive director of the Greater Freeport Chamber of Commerce, said the sale is a “great opportunity for change.”

And Kap Wallingford, a retired landlord, hopes one change will occur with the sale to Freeport Village Station.

“I’d love for the movie theater to open,” she said.

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