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Stymied Sale Of First National Center Could Proceed After Judge Appoints Receiver

First National Center in Oklahoma City
Brent Fuchs
/
The Journal Record

It's September in Oklahoma, which is a pretty lousy time to shut off the air conditioner.

That's exactly what happened at the First National Center in downtown Oklahoma City this week. The 84-year-old skyscraper in downtown Oklahoma has been for sale for well over a year, and last week employees and tenants that work in the building started moving their belongings out. On Tuesday, the building's utility company shut off A/C, which affected retail businesses and restaurants on the building's first floor.

"Veolia Energy says that it has $1.7 million in unpaid bills for the building, and it's just done with it. Other folks seem to be a little more lenient," said The Journal Record's managing editor Adam Brooks. "Now, Leon Neman, who's one of the supposed owners, said he would pay the bill, but he wants a guarantee that he'll be reimbursed when the building does sell. And he couldn't get that."

Neman is part of a pair of ownership groups called FNC-OKC I LLC and FNC-OKC II LLC that are the building's owner of record. District Judge Stephen Friot said the sale of the building went from "urgent" to an "emergency" after the building's air was shut off, according to The Journal Record's Molly Fleming:

The building has two possible buyers, California-based developer Stephen Goodman, and Texas-based developer Mike Sarimsakci. But defendant Howard Abselet’s attorney, John Stiner, said he thinks the Texas deal is doomed, even though it’s for $2 million more than the California buyer’s. Goodman offered to pay $23 million for the property. The title with Sarimsakci requires a dismissal of the lawsuit within 60 days of the closing. The title also states the sale could be extended up to 120 days while Neman attempts to persuade Abselet to dismiss the lawsuit. Goodman’s contract would allow for the lawsuit to continue.

On Thursday, Friot appointed Price Edwards & Co. Retail Division head Jim Parrack as a receiver for the building, that puts him in charge of managing the building.

"There's a fee for it. Before, they thought his fee was excessive. But he's come down a little bit," Brooks said. "So he would have to take the proceeds of the sale and keep them and then distribute later. That could take years of legal wrangling."

Read more of The Journal Record's coverage of the First National saga

Fleming says Parrack has the resources to bring the drawn-out process to a close:

He said he plans to contact California developer Stephen Goodman, who had previously said he would buy the center for $23 million. But a sales contract has not been signed. Oklahoma City attorney David Kennedy, who represents Goodman, said that to the best of his knowledge, his client is still interested. He said it wasn’t already under a sales contract because alleged owner Leon Neman told Goodman he could not give him a good title to the building with the ongoing litigation.

The handful of state agencies with offices in the First National Center finished moving out over the weekend, but this state of limbo has created a lot of uncertainty for the first-floor tenants. Some have moved across Robinson Ave., but others are just waiting it out. Brooks says there's a lot of confusion about leases.

"Some say they're still in effect. Some say the owners are materially breaching those leases, so they're not valid anymore. I don't know that any of that's going to be settled right now," Brooks said. "I think everybody hopes that there will be a quick sale, and then they can move forward and figure out what happens in the future."

The Business Intelligence Report is a collaborative news project between KGOU and The Journal Record.

As a community-supported news organization, KGOU relies on contributions from readers and listeners to fulfill its mission of public service to Oklahoma and beyond. Donate online, or by contacting our Membership department.

The Journal Record is a multi-faceted media company specializing in business, legislative and legal news. Print and online content is available via subscription.  

Brian Hardzinski is from Flower Mound, Texas and a graduate of the University of Oklahoma. He began his career at KGOU as a student intern, joining KGOU full time in 2009 as Operations and Public Service Announcement Director. He began regularly hosting Morning Edition in 2014, and became the station's first Digital News Editor in 2015-16. Brian’s work at KGOU has been honored by Public Radio News Directors Incorporated (PRNDI), the Oklahoma Association of Broadcasters, the Oklahoma Associated Press Broadcasters, and local and regional chapters of the Society of Professional Journalists. Brian enjoys competing in triathlons, distance running, playing tennis, and entertaining his rambunctious Boston Terrier, Bucky.
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