At least three potential buyers have approached the Buffalo Diocese about purchasing the 117-acre Christ the King Seminary property in the Town of Aurora, but diocese officials are putting off a sale due to the complexities of its Chapter 11 bankruptcy case.
Diocese spokesman Greg Tucker confirmed that multiple entities have expressed interest in buying the bucolic campus that has been a training ground for Catholic priests since the 1960s.
One of the potential buyers is the Masonic Care Community, which first inquired about the property in August and was preparing to make an offer, according to Christopher Hough, a trustee of the Masonic Hall and Asylum Fund.
The fund is affiliated with the Masonic Care Community that operates a long-term residential community care campus in Utica.
“It’s a pretty unique opportunity. It fits us like a glove,” said Hough.
Hough said he met with Steven D. Roth, the diocese’s associate director of buildings and properties, at the seminary. Masonic trustees from across the state had been scheduled to visit the campus this weekend until Roth informed Hough that the diocese had taken the property off the market, Hough said.
An independent appraisal of the property also was canceled, said Hough.
“We’re disappointed,” he said. “This would be a cash deal. We’d write the check or wire the money, however they want it handled. And we’d be prepared to close certainly within 30 days.”
The diocese was asking $5.3 million for the property, said Hough.
Tucker would neither confirm nor deny that figure, but he said the diocese had been only in preliminary, informal discussions with parties when it became clear that the rules of the bankruptcy court required additional steps to complete a sale. Diocese staff and attorneys were too busy with other matters to handle a sale now.
“At this time, the diocese is not pursuing the sale of Christ the King Seminary due to the extreme demands of the Chapter 11 process,” said Tucker. “The diocese will revisit an appropriate time to solicit offers in keeping with the extensive requirements of the federal bankruptcy court.”
The campus includes six dormitories, as well as a library, gym, auditorium, chapel, administration building, recreation center, dining hall and education building with 10 classrooms. It is assessed at $9.9 million, according to Erie County property tax records.
The diocese announced in February that it was closing the seminary to save money and refocus the way it trains men for the priesthood, as well as deacons and lay people in ministry.
In addition to the Masonic group, one of the potential buyers is a Catholic entity, said Tucker, who declined to name the organization.
In a bankruptcy sale, the debtor must obtain the “highest and best value” for its assets. Typically, that means marketing the property extensively, negotiating a purchase agreement with a buyer and then maximizing the value of the property through a bidding process.
“It’s our expectation that the diocese will liquidate, or sell, properties to fund its Chapter 11 plan and provide a settlement to survivors,” said Ilan D. Scharf, attorney for the official committee of unsecured creditors. “They can sell property at any time, as long as it’s got court approval and it’s a market-rate sale.”
“We would expect them to sell property in a commercially reasonable manner designed to maximize value,” he added.
The diocese owns more than three dozen properties the creditors committee will be eyeing as sources of settlement cash. Collectively, the properties are worth at least $16 million, and probably much more, because most of the properties have yet to be appraised, according to court papers. The diocese’s schedule of assets and liabilities filed with the bankruptcy court does not include an appraised value for the seminary property.
The creditor’s committee objected earlier this year when the diocese attempted to sell a high school building in Olean to the high school’s foundation for $150,000, arguing that the diocese was trying to do an insider trade and could get much more for the property on the open market. The diocese ended up dropping the deal for now.
Another potential complication of a seminary property sale is the likelihood that the Vatican would have to approve it.
Catholic canon law stipulates that a bishop must seek permission from the Holy See before selling a property for more than $5 million.
The Masonic Hall and Asylum Fund was created in 1864 and in 1893 built the Masonic Home in Utica for indigent Mason fraternity members and widows and children. The Utica property now features full-time skilled nursing care, an adult care residence and retirement living.
Hough said trustees of the fund are looking to “decentralize” operations through other projects in different parts of the state, including Western New York.
This past February, the fund bought the campus of the former College of New Rochelle, just outside of Manhattan, for $32 million, with an eye toward creating senior housing.
Senior housing also would be a key piece of what fund trustees would want to do at the Christ the King property, where the dormitories could be converted to living space, said Hough.
The not-for-profit fund has net assets of $272 million, according to its 2018 federal tax statements.
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