By Debbie Carson, Online Editor
SEBASTIAN — The auction of Flagship Marina, home of the since-closed Mike’s Hula Grill, will not go on as scheduled Friday morning, according to an attorney related to the case.
To keep the auction from moving forward, property owner Damien Gilliams filed for Chapter 11 bankruptcy, which forces all court motions to stop.
Oculina Bank had filed a $1.8 million foreclosure suit against Gilliams and the courts scheduled a public auction for Nov. 6.
Gilliams said Thursday afternoon that he had worked out an arrangement with a buyer for the property and went to Oculina Bank for approval. Instead, the bank refused to work with him, he said.
Attempts to reach Chris Russell, of Oculina Bank, and the bank’s attorney were unsuccessful Thursday.
Gilliams’ attorney, Leon Nichols, confirmed that Gilliams did file for bankruptcy and that it would put the auction on hold. Nichols also said that if Oculina Bank did not cancel the auction, it would be in violation of federal statutes.
Gilliams said that the reason the property fell into foreclosure is because the tenants who owned Mike’s Hula Grill pulled out of their lease. He said the owners had tried to get a liquor license from the state, but failed due to the city putting roadblocks in their way.
The owners had operated the restaurant for nearly four years before leaving the site. As of May 13, the property was mostly vacant, aside from a few boats docked at the marina.
Monthly mortgage payments for the property were about $15,600, according to court records.
Gilliams added that he tried to work with the bank to avoid the foreclosure to no avail. Judge Paul Kanarek issued the final foreclosure judgment on Aug. 13. In October, Kanarek ordered the property sold at public auction.
The property is listed for sale at $2.7 million, though Gilliams had the site appraised for $3.8 million. The City of Sebastian, too, had appraised the site at $2.7 million and $3 million within the last few years, according to court records.
The site includes a waterfront restaurant, marina, and deepwater dock space for boats. While in operation, the Hula Grill welcomed patrons coming by water and by land.
Managing Editor Ian Love contributed to this report.
