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Taxpayers May End Up Footing the Hotel Bill

June 10th, 2009 by admin · 14 Comments

It looks like there may be a good reason that Wayside Christian Mission offered up an exhorbitant price at auction for the Hotel Louisville at Second and Broadway.

It sure looks like the plan was to make sure that the property’s owners, including majority mortgage holder Gus Goldsmith, got paid in full and that the homeless organization picked up a nifty seven-figure profit by buying the property, then selling it for as much as $10.5 million to Jefferson Community & Technical College.

After a commissioner’s meeting held yesterday, it sure looks like Wayside Christian Mission may end up paying less than the $10 million it bid for the property at auction, and that it may sell the property, at a huge profit, to JCTC.

As you may remember, Wayside jumped the bidding at the auction from $1 million to $10 million, then Wayside director Nina Moseley couldn’t explain in a TV interview why she’d bid so much. And several sources have told us that Nina and her husband Tim Moseley held several meetings with Goldsmith prior to the auction. And, as Chase Cain reported on WHAS-TV yesterday, it was Tim Moseley’s name on the official document as the buyer of the property.

Is it possible that Goldsmith orchestrated this whole charade to boost the price JCTC pays for the property, with he and Wayside sharing the millions in excess profit? Was he worried that without the incredible Wayside bid, that the property might have sold for a number closer to $1 million, a number that wouldn’t have covered the mortgage holders? Will JCTC end up paying $10 million for a propety it should have been able to obtain for a fraction of that price?

We don’t know the answers to those questions, but it sure looks suspicious.

The Hotel closes Friday, and is supposed to be turned over to Wayside on Monday. But it’s not clear whether it even has the proper permitting to open a homeless shelter there.

Tags: Downtown · Education · Homeless · Metro Government · Wayside Mission

14 responses so far ↓

  • 1 Carter Burger // Jun 10, 2009 at 8:17 am

    What if JCTC refuses? What if they say “thanks but no thanks” and walk away? Does this mean that Wayside is stuck with it? The way this deal has gone down, that would be pretty sweet karma for Wayside/Goldsmith.

  • 2 AB // Jun 10, 2009 at 8:30 am

    JCTC should tell them no deal. Regardless if Wayside did this dirty deal with the intent to benefit the homeless (not their own pockets), they entered into a deal with a business devil who intended to line his pockets at public expense. I used to contribute to Wayside on a regular basis, but no more.

  • 3 bild // Jun 10, 2009 at 8:30 am

    What??? Someone would buy a piece of property and then try to turn around and sell it at a profit? Unheard of.

  • 4 Mark H // Jun 10, 2009 at 8:56 am

    Bild, there is a major problem with a “non-profit” homeless agency flipping properties. There should be some restriction that prohibits this activity.

    If I were JCTC and wanted to play hardball and only offer $5M for the property, the Moseley’s are in a world of hurt. When you pay 10x the appraisal value for a property, you have placed yourself in a hugely vulnerable position.

    There is no way they are going to be able to secure a loan on that collateral at that valuation. Real estate speculation is not for the amateur. I guess it’s easy for the Moseley’s to play real estate tycoon, when it’s not their money.

    I hope everything goes well, but I’m not sure they truly realize the risk and the dollar amounts they are playing with here.

  • 5 David Harpe // Jun 10, 2009 at 9:48 am

    If JCTC can afford to wait a couple of years, I think they should sit on their hands and see how long Wayside can float $10m. In this market there are not going to be other bidders willing to go that high.

    Even if someone buys it from Wayside, JCTC should just do business with those folks instead just on general principle. As Mark said, it’s really irresponsible for Wayside to be playing this game.

  • 6 Ted // Jun 10, 2009 at 10:08 am

    Welcome to Lousiville where the poor are left behind, the homeless sleep everywhere but under a decent roof and the city continues its perpetual decay. Sad but true and it is coming that more Lousivillains will learn what hard times are all about and frankly this den of thieves deserves it.

  • 7 Scott G // Jun 10, 2009 at 10:38 am

    Wayside and others like them need to be responsive to the concerns of their neighbors both commercial and residential. They were forced from the East Market area for multiple good reasons, local businesses were concerned with the lack of maintenance and upkeep on the Wayside property (walk around the current facility on Market to see what the concern is.), and another reason was the residents were causing the problems for local residents ( panhandling the businesses customers, defecating and urinating in public space and on private properties, and the local police officers have said they are called to the Market location more than any other location in the area (Approx. 45% of the emergency calls to the district call center.).
    As intelligent and informed citizens of Louisville we need to make decisions based on the facts and not on the hype. It is easy to condemn the EMBA/EDBA for not supporting Wayside mission in their quest to house all the worlds homeless, but the fact is that until they are responsible community members they can not expect to be meet with open arms anywhere.
    Why is it that if you oppose Wayside relocation to your neighborhood because of concerns that it will have a overall net negative impact, you do not care about the homeless issue and are motivated by NIMBY or greed. I am motivated by my desire to see my neighborhood thrive and prosper, and not start the slide into becoming a blighted area. (Use google maps to find any Wayside facility, drive to the location, park your car and go for a walking tour around any current wayside facilities and you will plainly see why so many people oppose these new locations for the Wayside Mega-Shelter.)
    Wayside is a shady nonprofit at best, questions surrounding the surprising 10M opening bid for a property which is worth less than 6M in a strong and healthy real estate market need to be addressed, this is the typical closed-door, back-room non-transparent way Wayside does business. Wayside Mission and Mr. Goldman ( the current mortgage holder of The Hotel Louisville and Action Pawn owner) can testify to people who are down on their luck are great business. Wayside is a multimillion dollar organization and should conduct itself as such.
    I personally am tired of them hiding behind the “We are doing Gods work” shield, if you oppose us then you also oppose Gods will and hate the less fortunate too. If they want to live the good book than follow this passage.
    Matthew 22:21
    Render therefore unto Caesar the things which are Caesar’s; and unto God the things that are God’s.
    The long and short of this is that being a faith based operation does not relive you of your responsibility to be a good citizen of your society, the concept that faith based businesses should not have to pay taxes is a relatively new idea. So give up your non profit status, start paying your fair share of taxes and stop using your mission as a hall pass from God to do anything you want. Do this and I for one will welcome you anywhere you want to move.
    Here are a couple of quotes from Burroughs on the subject, take from this what you want…….
    “Never do business with a religious son-of-a-bitch. His word ain’t worth a shit — not with the Good Lord telling him how to f**k you on the deal.”
    — William S. Burroughs
    “The junk merchant doesn’t sell his product to the consumer, he sells the consumer to his product. He does not improve and simplify his merchandise. He degrades and simplifies the client.”
    — William S. Burroughs
    My opinion of the subject lets hear yours……..

  • 8 Steve Magruder (I, not D or R) // Jun 10, 2009 at 12:48 pm

    It’s interesting that Nina Moseley may just turn out to be the smartest gal in the room.

  • 9 lt // Jun 10, 2009 at 1:42 pm

    And on Gods word, it seems to work for her.

  • 10 Carter Burger // Jun 10, 2009 at 7:14 pm

    I kinda like David’s idea. JCTC shouldn’t be in a hurry. Let’s see how long Wayside can tread water. If Wayside defaults on their service of the $10 million debt, JCTC may be able to get it for less than a mil!

  • 11 Ted // Jun 10, 2009 at 9:07 pm

    Looks like Scott G has some issues with the religious side of someone trying to do good. With people like you sticking your nose into the air it is no wonder why the homeless and the poor have such issues. Its not all about drugs or poor education or stupidity but often about low wage jobs, low incomes, and poverty. Which is what Louisville is all about. Its becoming more apparent that Louisville has a lot of issues that leads to these problems. That is why per capita, Louisville has a higher homeless population than our neighboring cities. But thats not important because we have to worry about keeping up the image of the Highlands and Downtown even though neither of them are anything to brag about. Spend some time in a real city like Chicago, NYC, LA, Charlotte, ATL, New Orleans, etc and you see things that makes the Highlands and Frankfort Avenue look like a dump. Same goes for the East End. Bellemeade in Nashville is much nicer than almost all of the East End including Lake Forest and Prospect. Edgewood in Northern Kentucky is nicer than East Louisville. Carmel and North Indy is nicer than East Louisville. So Louisvillians and their conceited attempts at fame needs to be shown for what it is. A city of nothing and a city that has to hide behind appearances. Shallow but that is what strikes me about a lot of the local population.

  • 12 TheColonel // Jun 11, 2009 at 2:48 pm

    How about this? Let’s see what happens when Wayside Christian Mission moves into the Hotel Louisville after the deal is sealed and watch them do what they have been doing for over 50 years: Serving the poor and unfortunate. This time they will have a suitable facility in which to conduct their business and will be extremely close to all the social service organizations that populate the downtown area, offering their clients even more options in this seemingly bleak and world-wary city.

    To Scott G.: It is incredible that I have finally found someone who agrees with me about the issue of Wayside being “FORCED” off of Market St.! Unfortunately you need to check your facts about the calls to the police. The majority of the police calls are for the Jefferson St. location not Market, and these include calls to 911 for clients who are experiencing health concerns. It is no wonder that there are a rash of these calls as the hospitals, (U of L, Jewish, and Norton) abandon these people on Wayside’s doorstep because they are unable to pay for healthcare.

    Scott G, I believe you have never set foot in a homeless shelter before in your life. You should go volunteer for a day and see what the conditions are like within the walls of Wayside before you judge them so harshly. If nothing else, you would be supporting the clients of Wayside by serving them a meal versus serving them crow.

  • 13 lt // Jun 12, 2009 at 1:37 pm

    So if they do make the sale. Who gets the money. The Moseleys. Not Wayside. Right? This seems to be about making money for Mr. and Ms. Moseley. If thats true, this sale has nothing to do with Wayside Christian Mission.

  • 14 Scott G // Jun 16, 2009 at 10:54 am

    My dear Ted, you are correct that Louisville has a abnormally high number of homeless for a city of its size. This isnt due to Louisville being a bad city, as a matter of fact it is routinely ranked in the top 10 livable cities in the US. It is due to the perception that Louisville is a sanctuary city, and that social services are abundant. I dont think that building mega homeless shelters will stop homelessness (sp?) no more than building mega prisons have stopped crime. As far as “nice” (wealthy judging by the areas you listed in your comment) parts of town and how we compare, WHO CARES!!! If you like those places move there, if you can afford it. After living all over the US I decided to raise my family here. I grew up here and remember when downtown rolled up the sidewalks at 4:30 when the offices closed, you couldn’t get a meal, buy a book, the town was a ghost town. Now we are starting to see a revitalization of the downtown area. Do you think putting a megashelter on Broadway will help attract new investment and the tax revenue, jobs, so forth that comes with it to the area? Is there a Megashelter on Michigan Ave I missed when I was there? You got me, there is homeless people at Underground Atlanta… Is that place still open?

    Colonel, yes I believe they were forced out and that is what you do to an organization that is not responsive to the concerns of the neighbors. Business, individual or NFP it doesnt matter if they refuse to address legitimate concerns, then you have no other option. If the local redneck on your block had been pulling this stuff for years, and your neighbors and you had a chance to get them out would you? The calls that I am referring to are the ones received by officers patrolling in the immediate area not the whole city police force and are not 911 health issues. As far as the issues you have with healthcare that is another topic all together, although I must admit I am just a little curious on your stance on single payer healthcare. And lastly I have in fact volunteered at Wayside and no it wasnt court ordered. I have also worked at some of the local archdiocese programs. Once again I do not hate people that need help. I just think that warehousing them all in a central mega facility isnt going to fix the problem.

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