The North Shore Music Theatre and its 26-acre property in Beverly will be auctioned off in October, according to an online listing by the company that will handle the auction.
The 54-year-old theater announced earlier this summer it was going out of business and was giving up a $2 million fundraising campaign it needed to put on a 2009 season. The theater had more debt that it could handle after a drop in ticket sales last season, a decrease in sponsorships and the costs associated with a 2005 fire that wasn't covered by insurance.
David Fellows, chairman of the NSMT Board of Trustees, said at the time that auctioning off the property was a possibility. On Monday, Fellows couldn't be reached for comment.
Daniel P. McLaughlin and Co. Auctioneers says the auction is scheduled for Oct. 1 at 1 p.m. at the Dunham Road theater. Nobody at McLaughlin could be reached for comment.
The auction will include the main theater building, the former education building and a separate restaurant on 26.5 acres.
McLaughlin's auction listing says the location has "tremendous redevelopment potential."
The property is assessed at $12.1 million by the city for tax purposes.
Fellows said in June that the theater's mortgage is $5 million and that while the land, buildings and other assets were worth $5 million at one time, it isn't worth that much now.
"Our guess is that it's half of that or maybe less," he had said.
In addition to the mortgage, the theater owes an additional $5 million to other creditors, including about $2.5 million in season ticket payments made for the 2009 season from about 4,400 subscribers. Boston Culinary Group, which ran the theater's food service, also has a $250,000 attachment on the property for unpaid bills.
Citizens Bank, which holds the theater's mortgage, appears to be making moves to foreclose on the property. On Aug. 8, a Citizens Bank vice president went inside the theater building "for the purpose...of foreclosing said mortgage," according to paperwork filed with the Salem Registry of Deeds.
It's not clear whether the auction was scheduled by the theater's board to avoid foreclosure or by Citizens as part of a foreclosure proceeding.
Article courtesy of Gatehouse Media, Inc. Bobby Gates / rgates@cnc.com
