CINCINNATI - Clifton Market shareholders voted 85 percent in favor of selling the neighborhood co-op to Gurmukh Singh, a restaurant owner who has been managing the store since Nov. 15.
The next step will be negotiating a short-sale agreement with lenders that hold about $3.1 million in mortgage debt on the property.
“I’ve had preliminary negotiations,” attorney Eric Goering told WCPO this week. “We need to try to put together a deal.”
Goering was hired by the Clifton Market Board to develop options for the troubled neighborhood store, which racked up about $6 million in total debt since its 2017 opening and posted average monthly losses of $30,000 in the last five months.
Singh, the owner of Elephant Walk restaurant on W. McMillan Street, told WCPO he wanted to keep the store open because of how connected Clifton residents are to the store.
“If we take over, then we’ll make the store profitable and we’ll try our best to make this store a long lasting and profitable business,” he said.
Singh’s proposal was by far the most popular of three options presented by Goering at a Nov. 27 shareholder meeting. Singh garnered 438 of the 514 votes cast. Another 55 shareholders voted to restructure the existing cooperative, while 21 voted for closure.
Goering said Singh offered $1.8 million for the building and store assets, which is more than the property is likely to fetch in foreclosure but less than the three mortgages on the property.
Arlington, Virginia-based National Cooperative Bank is owed $1.8 million on its first mortgage. Shared Capital Cooperative holds a second mortgage for $951,000. Shareholder Bob Bergstein is owed $233,000 for a third mortgage, Goering said.
WCPO contacted NCB to determine whether it's willing to strike a deal with Singh, but it did not immediately respond.
Goering said the lenders have reason to cooperate because a foreclosure can take years to resolve and may not generate more than the $1.8 million Singh has offered. Also, there are no individuals who pledged assets toward the loans.
“They can only go after the co-op,” Goering said. “The only assets are the building and the intangibles and nothing else.”