Chris Larsen went through a wild couple of days last week.

The guitar-maker had expressed interest in purchasing a downtown
warehouse from the Arizona Department of Transportation (ADOT). On
Thursday, Nov. 5, he thought he had the building; later, he was told
the building would instead go to auction. Finally, on Friday, he was
outbid.

Larsen had offered ADOT the minimum $165,000 for the vacant building
at 1 E. Toole Ave. It is a structure that was built in the 1930s as the
Baffert and Leon wholesale grocery, and was most recently home to Zee’s
Mineral Gallery.

Larsen’s offer was the only one ADOT received—until the
process was just about to close, when ADOT received another expression
of interest. That offer, however, was immediately withdrawn. Steve
Fenton, a businessman with a background in downtown
historic-preservation projects, reportedly took that action.

After the withdrawal, Larsen was still the only party that had
submitted the $16,500 required deposit on the property. However, ADOT
determined that a public auction would have to take place, anyway.

Before Friday’s auction, Larsen explained: “My wife tells me I’m no
businessman, but a man with a warehouse is a man with
possibilities.”

At the Friday auction, four bidders were present. One bidder, a
representative of Fenton, never said anything. Instead, Larsen and two
others did all the bidding.

The price went up quickly, with Larsen dropping out at $226,000. In
the end, real-estate company Peach Properties acquired the building for
$252,000.

“We do artist space,” declared Patricia Schwabe of Peach Properties.
“The price will allow us to do that.”

Even though Peach has a long history of working well with tenants in
the downtown area, Schwabe said she saw “sour faces” come from several
artists in attendance after the auction.

Schwabe stated that Peach would look at some local art galleries,
such as Dinnerware, as possible tenants. Dinnerware is being forced out
its Congress Street locations next spring because of a proposed
restaurant at Congress and Fifth Avenue.

Dinnerware’s David Aguirre later said that he is actually a partner
in the 1 E. Toole project and will manage the building. He stated
Dinnerware Gallery, which he supervises, would definitely be moving
into the space, along with other tenants.

The warehouse Peach Properties just purchased is considered a
“dangerous building” by Tucson Fire Department inspectors. Previous
cost estimates for building rehabilitation have varied widely, but
Peach Properties has experience with such matters after restoring a
number of historic buildings around Sixth Avenue and Sixth Street for
use by artists.

Purchase of this one ADOT-owned building by the private sector may
be a harbinger of things to come in the Warehouse District. For years,
artists have worried about what would happen when ADOT finally disposed
of the 15 or so historic buildings the state owns downtown. Artists
were prepared for the worst, fearing that speculators and developers
would purchase the structures and force them out through higher rents
or evictions.

A test of these fears may be on the horizon.

At 31 E. Toole Ave., a few doors east of the building just bought by
Peach Properties, is Solar Culture, the well-known gallery and
performance space developed by Steven Eye.

As reported in The Skinny last week, WAMO obtained approval from the
city’s Industrial Development Authority to borrow funds to buy the
building. WAMO planned to rent it to Eye so he could continue to
operate Solar Culture.

“We’re not out to own buildings,” said president Marvin Shaver about
WAMO, “but we’ll put restrictions in place to limit the use to
affordable arts space, then sell it.”

The building, appraised at $95,000, was placed up for auction on
Tuesday, Nov. 10. After a quick but tense process, Fenton’s
representative outbid WAMO and purchased the property for $101,000.

ADOT also has three other downtown warehouses for sale. All of these
buildings were acquired by the state many years ago to build the last
mile of the Barraza-Aviation Parkway. However, that proposed route has
long been abandoned.

Situated between the warehouse just purchased by Peach Properties
and Solar Culture is a three-bay building valued at $265,000. Present
tenant Bob Mick, a woodworker, says he can’t afford that price and will
keep renting from ADOT until someone “puts money down” on the
structure.

Well, an offer was placed on that very building last week. That
means that within 30 days or so, it also should be sold.

A block to the east, RISE recycling service occupies a large
warehouse appraised at $360,000. No one from the organization could be
reached for comment.

At Stone Avenue and Fifth Street, an available warehouse sits vacant
with an asking price of $195,000. An “unsafe structure” notice from the
Tucson Fire Department is posted on this building’s backdoor.

The address on the notice is incorrectly listed as 1 E. Toole Ave.
That’s actually the location artist Chris Larsen tried unsuccessfully
to buy.

This article appears in Nov 12-18, 2009.