Questions raised about fairness of Atlantic City real estate auction

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ATLANTIC CITY — City council delayed accepting winning bids from an online home auction Sept. 14 after a bidder said at Wednesday night’s council meeting that he had wrongly lost a property after the bidding process concluded.

“I was the last person to bid at 11 when it was supposed to end. I bid $130,000,” said Solomon Andemariane, who bid on a lot at 822 Lexington Ave. “Seven minutes later someone offered $140,000 (and it was accepted). I think I should get it for $130,000.”

Council President George Tibbitt then questioned whether the list of highest bidders should be voted on, as there were some doubts as to its fairness.

“We must maintain the integrity of our auctions,” Tibbitt said.

Bob Dann, executive vice president at Max Spann Real Estate & Auction Company, said he was contacted by city officials early Thursday and assured them there would be no final bid cut off at 11 a.m. and Andemariane knew that.

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“The auction didn’t end until 11:20 a.m.,” Dann said. “He (Andemariane) bid after 11.”

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Then Andemariane said he called him when the bidding resumed after 11am and he told Andemariane it wasn’t closed yet.

“He called my office and said, ‘When are you going to stop bidding?'” Dann said. “I said the auction is still going on and said there was still time to bid and he hasn’t made another bid.”

“We are now investigating the matter, but we are confident that everything was done correctly at the auction,” said a city spokesman on Thursday.

Promotional materials for the auction were a bit confusing regarding start and stop times.

In information on his website, Max Spann says:

“Online auction bidding: Opening on Monday, September 12, 2022, 9:00 a.m. and closing on Wednesday, September 14, 2022, Group A: 11:00 a.m., Group B: 12:00 p.m..”

The property in question belonged to group A and the statement can be interpreted to mean that the bidding for this group ends at 11:00. But Dann said 11am is the official start of bidding, with pre-bids taking place earlier.

The council decided to postpone voting to its next meeting, which could be either a special session or the next scheduled meeting in October.

The auction raised nearly $2.5 million for the city, said Council Vice President Kaleem Shabazz, who warned the city believes the auction was improperly conducted.

“We have to be careful. I don’t think we should suggest that there were multiple instances where things weren’t consistent with the process,” Shabazz said. “It hurts us as a city.”

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Business Administrator Anthony Swan suggested delisting Andemariane’s offer and approving the rest.

“We have no evidence of anything else or complaints regarding the auction,” Swan said.

But council member LaToya Dunston suggested waiting for the entire list, which the council eventually supported.

“I think we should pull the whole thing to make sure the whole process was done right,” Dunston said.

City Attorney Michael Perughini said the council must accept the bids at the next council meeting to comply with the auction rules.

The auction of 47 municipal lots grouped into 36 lots was led by Max Spann, who has offices in New York, New Jersey and Florida and has a long history of conducting municipal lot auctions.

The Sept. 14 auction included nearly 4 hectares of land in an area designated for use by a cannabis company, as well as waterfront and commercial lots and other development areas. Eleven houses in need of refurbishment were also included, as was a waterfront residential property with new bulkheads.

REPORTER: Michelle Brunetti Post


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