Auction for Paterson's Art Factory site approved
By: Joe Malinconico
Paterson Press
PATERSON - A federal bankruptcy judge has approved the impending auction of the controversial Art Factory complex near the Great Falls, which for more than six years hosted weddings and other banquet hall events, along with studios for filmmakers and artists.
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The bankruptcy trustee, Eric Perkins said in court papers that the complex's old industrial buildings are in "poor condition" and "deteriorating," adding that some squatters have been found on the premises.
..... "I believe, in my business judgment, that it is in the best interest of the estate in order to maximize the Spruce Street property value to liquidate this asset at the earliest possible date," Perkins wrote in a sworn statement filed with the Bankruptcy Court on December 20. [2024]
..... The Online bidding, conducted by the Max Spann Real Estate & Auction company, is scheduled to start at 9 AM. on January 28 [2025] and to conclude at 11 AM. On January 30. [2025] Previous plans to conduct the auction in late November [2024] were canceled because the bankruptcy Court has not given its approval.
..... For several years, Mayor Andre Sayegh had talked about the Art Factory complex - owned by David Garsia, one of his political supporters - as an important part of his plans to revitalize the area around the Great falls along with the rest of Paterson.
..... The mayor recently said he would like to see the new buyers put a hotel at the location.
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Garsia's bankruptcy, filed last September, [2024] resulted in the cancellations of more than 150 wedding receptions that had been scheduled at the Art Factory Couples said they paid thousands of dollars in advance to book the banquet hall. It's not clear how much money - if any - the canceled couples will get from the bankruptcy.
..... The list of Garsia's creditors, which was field with the federal court, was 19 pages long. Court files indicated that the city of Paterson, which has $400,000 in tax liens against Garisa, will get top priority for repayment.
..... Next in line will be Billy Procidea, a Bergen County real estate investor, who gave Garsia $12.5 million loan about six years ago to renovate the Art Factory complex. Procida obtained a court judgment against Garsia after the borrower defaulted on $11.99 million of that loan.
..... Garisa field a petition with the court last year [2024] claiming the property was worth $16 million.
..... But the bankruptcy trustee said he believes that value was "highly inflated."