WILKES-BARRE — The four-story Sterling Annex has shown no visible signs of renovation since a Bear Creek Village man bought it two years ago, and now the property is on the Luzerne County’s back-tax auction list.
Property owner G2A-B Realty LLC, owned by George Asimakopoulos, owes $49,000 in real estate taxes for 2012 and 2013, county records show.
The River Street annex is located next to the lot that once housed the landmark Hotel Sterling. The condemned hotel’s demolition in July 2013 has made the annex’s boarded-up windows and neglected facade more noticeable.
Asimakopoulos could not be reached for comment on his plans for the property and taxes. G2A-B obtained a city building permit for minor electrical work in November 2012 but hasn’t requested any additional permits or submitted proposed development plans for the property, city representatives say.
Officials have said Asimakopoulos wants to convert the structure to residential units with views of the Susquehanna River, but he has not publicly detailed his plans.
The county’s tax claim office, operated by Northeast Revenue Service LLC, said someone inquired about a payment plan on the property so it could be removed from the Sept. 11 sale.
The structure of repayment agreements is set by state law, requiring 25 percent down with the remainder paid off in a year. G2A-B would have to come up with $13,000 up front and pay $9,775 in quarterly installments.
G2A-B Realty purchased the property from the Greater Wilkes-Barre Chamber of Business and Industry for $215,000 in 2012.
The chamber had acquired the annex for $125,000 in 2004, with hopes that someone would buy and use the building for a museum or art gallery.
Mortgage terms
Although the chamber no longer owns the property, the chamber is still involved because its Greater Wilkes-Barre Development Corp. provided a $135,000 mortgage to G2A-B at the time of its purchase.
This mortgage requires G2A-B to “promptly pay” all taxes before they become delinquent, according to a review of the document filed with the county.
The Sterling annex project’s lack of progress has become an issue because the chamber originally purchased the property with money from Luzerne County Community Development Office’s business loan fund.
County officials announced in April that the U.S. Department of Housing and Urban Development (HUD) is trying to force the county to put $10 million back into its loan fund because seven projects that received loans have not created jobs, including the Sterling Annex.
HUD argued evidence of timely job creation is required to keep the projects in compliance with HUD regulations, but county officials say federal regulations don’t specify a specific time limit for the job creation.
The county is contesting the repayment directive. County Community Development Executive Director Andrew Reilly said HUD is still reviewing information submitted by the county.
In addition to buying the annex, the chamber spent its $3.1 million county business loan for projects on vacant industrial park land and the Innovation Center in downtown Wilkes-Barre.
KOZ status
Chamber officials have said the annex won’t generate property taxes until a decade after the structure is occupied because it’s in a Keystone Opportunity Zone (KOZ). However, county assessment records indicate the KOZ expired in 2010.
The 0.21-acre property was assessed at $1.62 million for county and school taxes when it was purchased by G2A-B, but the assessment has since been reduced to $250,000 as the result of an appeal, county records show. The city has its own assessments.
The 29,522-square-foot Classical Revival style annex was built in 1912 as an Elks Lodge and acquired by the Hotel Sterling owners around World War II, when it took on its annex name, a chamber representative has said.
The building was used as an ancillary ballroom and meeting space for the hotel before serving as a Luzerne County Community College campus in the late 1960s and ’70s. Offices later were housed there. The annex has been vacant since plans to turn it into a college art museum died in the early 1990s.
The chamber mothballed and secured the structure so it wouldn’t continue to deteriorate while options were explored.
A 33.67-acre vacant parcel owned by the chamber in Plains Township also is listed in the September tax sale due to $137,941 in back taxes, county records show.
Wico van Genderen, the chamber’s new chief executive officer, said chamber officials are negotiating a potential sale of the property along state Route 115.
Van Genderen said he will explore options if the sale falls through or cannot be finalized before the Sept. 11 sale, such as a payment plan or court request for more time.
The chamber honored a past payment plan with tax claim to cover back taxes owed for 2010 and 2011 on the property, records show.
Chamber officials are trying to sell unneeded real estate holdings so the agency can increase its focus on attracting jobs and boosting the economy, van Genderen said.