Upcoming Auctions

The DC Department of Housing and Community Development (DHCD) is pleased to announce that a real estate auction of DC Government-owned vacant property will take place on Thursday, November 10, 2011 at the United States Navy Memorial, Burke Theatre, located at 701 Pennsylvania Avenue, NW, Washington, DC 20004.  The event will begin promptly at 2 p.m.

Eleven properties, including single-family and multi-family buildings and vacant lots, will be offered for sale to non-profits and District of Columbia Certified Business Enterprises.  The properties will be sold to the highest bidder for the purpose of redeveloping the properties into habitable residences and placing those residences on the District of Columbia's tax rolls. The properties are located in Wards 1, 2, 5, 6, 7, and 8.

The auction will be administered by DHCD's Property Acquisition and Disposition Division (PADD) and will be conducted by Alex Cooper Auctioneers, Inc.  PADD was established at the beginning of fiscal year 2008 and consolidates the Homestead Housing Preservation Program, the Home Again Program, the Land and Housing Development Opportunities Program and other property acquisition and disposition functions into one division. The goal of PADD is to stabilize neighborhoods by (1) decreasing the number of vacant and abandoned properties in the District, and (2) transforming vacant and/or deteriorated properties into homeownership and economic development opportunities for District of Columbia residents. 

In January 2009, PADD held the Department's first auction.  As a result of the first auction, PADD closed on the sale of 17 properties, returning those properties to the tax rolls and generating over $3.7 million in revenue for the District.  In June of 2010, PADD held the Department's second auction.  Since the second auction, PADD has closed on the sale of 15 properties and generated over $2.9 million in revenue for the District.  PADD hopes to continue the success of the auction program.

The proposed transactions for the purchase and sale of property owned by the District of Columbia ("District"), acting by and through the Department of Housing and Community Development, shall be governed exclusively by the Property Disposition Agreement ("PDA"). We strongly encourage and recommend that all interested bidders review the PDA, the Declaration of Covenants, and the Auction Participation Agreement and consult with legal counsel prior to participating in the auction, scheduled for Thursday, November 10, 2011 at 2 p.m. at the United States Navy Memorial, Burke Theatre, located at 701 Pennsylvania Avenue, NW, Washington, D.C. 20004. All auction participants will be required to sign the Auction Participation Agreement in order to register to participate in the auction. Winning bidders will be required to sign the PDA prior to the end of the auction. In addition, winning bidders will be required to sign the Declaration of Covenants at the property closing. The Declaration of Covenants requires completion of construction on the property within eighteen (18) months of closing.

1) Who Can Participate in the Auction?

Participation in the auction is limited to the following participants:

• Business entities which are active Certified Business Enterprises ("CBEs") registered with the District of Columbia Department of Small and Local Business Development

• Not For Profit Corporations

All participants will be required to sign an Auction Participation Agreement and certify that they meet one of the outlined participation requirements. A qualified auction participant may bid on any and all properties; however, each CBE and non-profit participant may only purchase and be deemed a winning bidder for a maximum of two (2) properties.

2) Bidder Registration Requirements.

On the day of the auction, all auction participants must register to receive a bid paddle. Each participant will be required to present a bidder registration fee in the amount of Twenty Thousand Dollars ($20,000) for each property that they intend to bid on and purchase. The bidder registration fee must be paid in the form of a cashier's check or a certified check payable to the auction participant. NO CASH WILL BE ACCEPTED. In the event that the auction participant is declared the winning bidder on a property, the Twenty Thousand Dollars ($20,000) bidder registration fee will be collected and held by the auctioneer.

3) Buyer's Premium.

A buyer's premium in the amount of five percent (5%) of the bid price shall be charged for each property purchased at the auction. The buyer's premium will be added to the winning bid price to arrive at the total contract purchase price for each property. The total contract price shall be paid by the purchaser at closing (i.e. if the winning bid price is $100,000 a 5% buyer's premium of $5,000 is added to the winning bid price to arrive at a total contract purchase price of $105,000). NOTE: The buyer's premium is not a separate fee paid by the purchaser on the day of the auction.

4) Deposit Requirement.

Within three (3) business days of the auction, for each property purchased, the winning bidder shall deliver to the auctioneer a deposit in the amount of ten percent (10%) of the total contract purchase price. The bidder registration fee shall be credited towards the ten percent (10%) deposit amount. The winning bidder shall pay any additional sums required to equal the ten percent (10%) deposit amount within three (3) business days of the PADD Auction. If the ten percent (10%) deposit amount is less than the bidder registration fee ($20,000), Alex Cooper will retain the full bidder registration fee as the deposit for the property to be credited to the purchase price at closing. If applicable, additional deposit funds may be paid within three (3) business days of the PADD Auction in the form of a cashiers check or certified check payable to Alex Cooper Auctioneers, Inc. All deposits will be held in a non-interest bearing account by the auctioneer as set forth in the PDA. The deposit shall be credited to the purchase price at closing.

In the event the winning bidder fails to pay the deposit within the proscribed period, the winning bidder shall be declared in default and shall forfeit all bidder registration fees to District as liquidated damages.

5) Documents to be Signed by Winning Bidder(s) on Day of Auction.
Each auction participant shall be required to pay the bidder's registration fee and sign the PDA immediately after being declared the winning bidder. The executed PDA shall control all terms and conditions of the sale. NO CHANGES TO THE TERMS OF THE PDA WILL BE PERMITTED. All auction properties shall be subject to the terms of the District's Declaration of Covenants, which requires the winning bidder to develop or rehabilitate the property according to specific guidelines and restrictions. The Declaration of Covenants will be executed by the winning bidder at closing.

6) Auction to be Sold Absolute to the Highest Bidder.

Properties offered will be sold without a minimum reserve price.

7) "AS IS" "WHERE IS" Disclaimer.

DISTRICT SHALL CONVEY THE PROPERTY TO THE WINNING BIDDER IN "AS IS," "WHERE IS" CONDITION WITH ALL FAULTS AND DISTRICT MAKES NO REPRESENTATIONS OR WARRANTIES, EITHER EXPRESS OR IMPLIED, AS TO THE CONDITION OF THE PROPERTY, AS TO THE SUITABILITY OR FITNESS OF THE PROPERTY, AS TO ANY LAW, OR ANY OTHER MATTER AFFECTING THE USE, VALUE, OCCUPANCY, OR ENJOYMENT OF THE PROPERTY, OR, EXCEPT AS SET OUT IN SECTION 3.1 OF THE PDA, AS TO ANY OTHER MATTER WHATSOEVER. DISTRICT SHALL HAVE NO RESPONSIBILITY TO PREPARE THE PROPERTY IN ANY WAY FOR DEVELOPMENT AT ANY TIME. THE WINNING BIDDER ACKNOWLEDGES THAT NEITHER DISTRICT NOR ANY EMPLOYEE, REPRESENTATIVE, OR AGENT OF DISTRICT HAS MADE ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY.

8) Property Inspection & Conditions.

Please note that the properties are not available for inspection prior to the auction and are subject to the District's trespassing laws. The District has posted "no trespassing" signs on each property.

All information contained in the catalog and on the auctioneer's website or any other promotional materials including, but not limited to, photographs, directions, lot & square, zoning and taxes have been provided by the District and is believed to be correct. However, neither District nor the auction company makes any guarantee or warranty as to the accuracy or completeness of such information.

Note: Although the properties will not be available for inspection prior to the auction, if you intend to bid on a property the District strongly urges you to perform due diligence before the auction. Please ensure that you are familiar with the property location. Please also ensure that you research the property's zoning designation.

9) Public Hearing.

Within 60 days following the auction, the District will hold a public hearing. In order to execute the PDA, the District must hold a public hearing after giving 30 days notice. Within 7 business days prior to the scheduled public hearing date, all auction winning bidders must submit proof of financing capacity to cover both acquisition and development costs for their auction property in the form of a conventional bank pre-approval letter and/or bank statements showing sufficient funds to cover all costs. If you will not be able to provide adequate proof of both acquisition and development financing capacity within 45 days of the PADD Auction, you should not participate in the auction.

10) Closing.

All closings shall be in accordance with the conditions set forth in the PDA. The winning bidder will be granted possession of the property at closing and will be subject to the terms of the District's Declaration of Covenants. All auction properties must be fully developed within eighteen (18) months of the date of closing. Said development obligations are outlined in the Declaration of Covenants.

Note: All Certified Business Enterprise winning bidders will be required to enter into a Certified Business Enterprise (CBE) Agreement with the DC Department of Small and Local Business Development (DSLBD) prior to closing.

11) Rights of District and Auctioneer at the Auction Event.

The District reserves the right to add to or delete from the auction any property by oral or written announcement prior to or during the course of the auction. All such announcements shall take precedence over all promotional materials including, but not limited to, advertisements, catalogues and the auctioneer's website.

All decisions of the auctioneer are final as to sale order, the methods of bidding, disputes among bidders, increments of bidding, priority of bidders and any other matters that may arise before, during or after the auction. The District reserves the right to expel anyone who in any way disrupts or attempts to disrupt the auction event.

12) Auctioneer's Notice of Relationship to District.

The auctioneer is acting as a contractor for the District in this transaction. The auctioneer is not acting as agent for the auction participant in this transaction. Any buyer or broker is acting as an agent for the auction participant and is not a subagent of the auctioneer.

13) 180-Day Lower Tax Grace Period to Obtain Building Permits.

All auction properties shall receive a one hundred eighty (180) day grace period (the "Grace Period") from the Department of Consumer and Regulatory Affairs ("DCRA") during which all auction properties shall be subject to their original tax classification, Residential Class 1 tax rate of eighty-five cents ($0.85) or Commercial Class 2 tax rate of one dollar and sixty-five cents ($1.65) per one hundred dollars ($100.00) of the assessed value, to allow for application to DCRA to obtain the required building permits necessary for commencement of construction. Upon expiration of the Grace Period, said auction properties may be subject to the Class 3 tax rate of five dollars ($5.00) per one hundred dollars ($100.00) of the assessed value, if applicable.

14) Broker CO-OP.
The auctioneer is offering a 2% broker CO-OP to licensed District of Columbia real estate brokers/agents. All broker participation agreements must be submitted a minimum of 48 hours before the auction sale. Please submit the signed agreement to matt@alexcooper.com or fax to 443-470-1440. Click here to download the broker participation agreement.