Brady Sullivan picks the carcass of FRM

Brady Sullivan Properties has made an offer to purchase Beaver Pond Estates from the trustee overseeing the bankruptcy of Financial Resources Mortgage, Inc. (FRM) and CL&M, Inc, and is eying other distressed properties stranded by the Meredith firms' collapse, including Lilac Valley on Route 107 and Apple Ridge off Route 106 in Laconia.

The company has offered $800,000 for the 49-unit condominium project on Rollercoaster Road. Although less than a dozen units are finished, the infrastructure — roads, drainage and utilities, including municipal water and sewer — is complete.

"This is how I got started in 1990," Shane Brady said yesterday, buying bankrupt projects and foreclosed properties. "We bought 1,000 units planned as condominiums and rented them as apartments," he said. "After 2000 we began to see an increase in our vacancies and realized everyone was buying," he continued. "So we started converting back to condos. The first wave of inventory was our inventory."

"We're looking at a bunch of stuff," Brady said, particularly multi-unit residential properties — condominiums and subdivisions — all across New England. "Nobody knows where everything caught up in this situation is," he said. "We hear about something new every day."

"This is not like any other bankruptcy," Brady stressed. "It's all new to me. A learning experience." Typically, he explained, there is one owner with one set of records, but the ownership of properties financed by FRM and CL&M is frequently obscure while the documentation is suspect and scattered.

"You've got to put the pieces of the puzzle together," Brady said, adding that required permits may be about to expire or site work may not be done to specifications. Brady said that the bankruptcy trustee, Steven Notinger and his law partner Jim Donchess, are packaging the properties to provide buyers with clear titles while his team assesses the economic potential of the investment. Before entering the purchase and sales agreement to acquire Beaver Pond Estates, representatives of the company combed through the files of the Laconia Planning Department and reviewed the history of project with department staff.

"We bring experience and cash to the table," Brady said. "We're coming in with our eyes open. We understand these properties and can breathe new life into them."

He said that brisk sales of units at Paugus Woods, the modular home development on White Oaks Road the firm acquired last year, encouraged him to shop for more property in the city. He said that 21 of the 24 units of the first phase at Paugus Woods have been sold and work has begun on the second phase of 49 units of what is planned as a 93-unit development.

For Brady Sullivan Properties, the demise of FRM and CL&M offers an opportunity to expand its already significant presence in the local housing market. In addition to Paugus Woods, the firm owns Moulton Cove and the Evergreens, condominium complexes, as well as several cottage communities along Weirs Boulevard, which it purchased and converted to condominium. Meanwhile, earlier this year the company returned to the Planning Board with a fresh design for a development at Langley Cove of Weirs Boulevard, where it proposes 291 residential units.