Foreclosure sale paves way for city

With only a few seconds of silence at the Charleston County auction block, roughly $1.5 million of debt against a North Charleston shopping mall disappeared, putting it one step closer to a city-led redevelopment.

No one called out a bid to buy Shipwatch Square, an 18-acre complex at Rivers and McMillan avenues that was open to all comers outside the Judicial Center.

The property was supposed to be redeveloped into shops and homes, but it fell into foreclosure after Monarch Development LLC could not secure another grocery store to replace the shuttered Winn-Dixie.

At the county's foreclosure auction Tuesday, the property went directly back to the lender, Preservation Capital Consultants, in the absence of bids. The former property owner owed roughly $3.5 million to Preservation Capital and an additional $1.5 million to at least two groups that it borrowed from.

The secondary batch of debt was wiped out through the foreclosure process, paving the way for the city of North Charleston to purchase the property. Mayor Keith Summey said he helped negotiate the price down to $2.5 million.

The city plans to raze the buildings and replace them with -- among other things -- a grocery store.

Ray Anderson, special assistant to the mayor, said the city could buy the property within weeks. North Charleston City Council could take up the issue with a resolution next week.

Rule of law

Federal officials who are trying to solve the nation's foreclosure crisis could turn to a South Carolina-bred strategy.

U.S. Department of Treasury officials are considering a rule that would require lenders to evaluate struggling homeowners for the agency's Home Affordable Modification Program, which has lowered mortgage payments for roughly 1.3 million homeowners across the country. Lenders wouldn't be able to file a foreclosure lawsuit against homeowners before determining whether they qualify for the program.

That rule would be similar to what the S.C. Supreme Court implemented in May. Before that, lenders could begin foreclosing on a homeowner even if they had formally requested a loan modification.

The state's court order also required that lenders put an explanation in their foreclosure lawsuit as to why the homeowners didn't qualify for the federal program.

At the time of its implementation, housing advocates said it was the only rule of its kind in the country. North Carolina regulators adopted a similar policy last week.

Reach Katy Stech at 937-5549 or kstech@postandcourier.com.