Bankrupt bank’s offices for sale

Caledonian Bank, based in Caledonian House in George Town, went into liquidation and bankruptcy last year following a run on the bank after the SEC froze its assets. – Photo: Taneos Ramsay
Caledonian Bank, based in Caledonian House in George Town, went into liquidation and bankruptcy last year following a run on the bank after the SEC froze its assets. – Photo: Taneos Ramsay

The Caledonian building and solar car park in George Town has gone on the market as its liquidators attempt to recover some cash from the defunct company to pay off its creditors.

The bank, which had been in business for 44 years, was declared bankrupt in February last year just days after the U.S. Securities and Exchange Commission filed a lawsuit in connection with sham stock offerings and penny stock pump and dump schemes.

Caledonian House, the three-story office building on Dr. Roy’s Drive, which served as the bank’s headquarters, was recently valued at US$6.5 million.

However, Avata Property Services, which has been instructed by liquidators EY on the sale, indicated it will listen to all offers for the property.

“Obviously, it will ultimately be worth what a commercial investor believes they will be able to rent it for,” said Matt King, a senior surveyor with the firm.

He said the building would appeal to an owner-operator or, more likely, a commercial landlord.

A unique feature of the building is its distinctive parking lot, covered with solar panels. This provides an income of around US$83,000 annually through the Caribbean Utilities Company’s CORE program, according to Avata.

The building itself, which features 17,000 square feet of office space, covers only 11 percent of the site, meaning there is some development potential.

Mr. King said the sale was not listed on the standard property multi-listing system and was being advertised specifically to commercial investors.

In a more general analysis of Cayman’s office rental market, Avata notes that demand in George Town is being impacted by quality new developments in Camana Bay and Cricket Square.

It states, “The highest vacancies are in the lower classed buildings, the majority of which are located within George Town. We are of the opinion that this due to factors such as the government consolidating their operations into the new building and, in particular, Camana Bay and Cricket Square enticing many of the larger corporations to new high specification accommodation.

“The deterioration of George Town as a location may also be a factor as numerous bars and eateries have closed in recent years and areas slated for redevelopment, such as Mary Street, Eastern Avenue and Shedden Road, have been neglected.”

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2 COMMENTS

  1. I certainly hope the a/c has been left on. Otherwise any prospective buyer may have to contend with serious mold issues.

    All in all though very sad that this long established company should have been driven out of business by an over aggressive SEC and an overly skittish local regulator.

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  2. From what it looks like, the accounting firm ‘in charge’ of closing Caledonian down haven’t done a good job taking care of the building. It is still a shame that all those good people were thrown out of work because of the failures of the US and our regulators. May we all pray that this never happens again. HC

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