Support Local News.

Please support our work by subscribing today.

Spicer Mansion's pending $3.8 million sale would settle foreclosure suit

Mystic — Owners of the Spicer Mansion averted a public foreclosure sale scheduled for Saturday, securing a verbal agreement to sell the boutique hotel for $3,825,000, eleventh-hour court filings show.

Gates Realty, in a motion filed Thursday in New London Superior Court, said it had reached an agreement with a buyer the previous day and expected the purchase price to satisfy all creditors with an interest in the Groton property.

“The parties are working in earnest to formalize a purchase and sale agreement and expect one to be executed next week,” the filing says.

Gates Realty also noted the winter storm forecast for Saturday would have “an adverse impact” on bidders’ participation in the sale.

On Friday, Chelsea Groton Bank, which sued Gates Realty in 2019, alleging it had defaulted on a nearly $1.8 million mortgage loan approved in 2015, provided “limited consent” to the sale’s postponement, which Judge Robert Young granted.

The auction was to have taken place at noon at 15 Elm St., the premises of the Spicer Mansion. The eight-room hotel, built in 1853 as the home of Captain Elihu Spicer, a Noank native who built the nearby Mystic & Noank Library, was assessed at $3,670,000.

Bidders were required to file a $367,000 deposit with the attorney appointed to oversee the foreclosure sale.

Chelsea Groton agreed to postpone the sale until March 12, “in consideration of a $100,000 largely non-refundable deposit associated with a prospective purchase in the amount of $3.825 million and a closing to occur on or before March 1, 2022.”

Brian Gates of Gates Realty said Friday he was not at liberty to identify the prospective buyers, whom he described as “local, experienced hotel operators.” He said the buyers intend to continue operating Spicer Mansion as a hotel.

Gates said the parties had been negotiating a deal since soon after the foreclosure action was initiated.

Gates had secured the Spicer Mansion mortgage with second, third and fourth mortgages on his family’s residence at 116 Cove Road in Stonington and on properties he owns in Plainfield and Putnam. Gates and Chelsea Groton had agreed that if the Spicer Mansion sale price was sufficient to satisfy the debts of all creditors with an interest in the Spicer Mansion, the sale of the other properties would be canceled.

The other properties were to be auctioned March 19.

The Town of Groton is among the Spicer Mansion creditors, having sued Gates in 2018 over alleged zoning violations resulting in $12,500 in unpaid fines.


Loading comments...
Hide Comments