Topped off: Convenience store owner is Fuel's high bidder
After a spirited bidding war that included half-million-dollar-plus bids from one of Charlottesville's best-known developers and from the company that may have created the concept of the upscale filling station, a heretofore low-profile business owner made the winning bid for the long-closed Fuel Co. station in a July 14 foreclosure auction.
Located on Market Street at the northern terminus of the Belmont Bridge, the .31-acre site was once heralded as the vanguard in a new wave of upscale gas stations. But after the Thursday morning auction, it appears on its way to trade hands for about half its assessed value.
With a winning bid of $580,000, Subhash "Sam" Desai outbid developer Keith Woodard and David Sutton, leader of Tiger Fuel, the petroleum company that, with its Bellair Market, appears to have pioneered the notion of selling fancy foods at gas stations.
"There are a lot of problems with the property," said Sutton, explaining why he halted his bids at $575,000. "This has been a gas station for 30 or 40 years, so there's no telling what's in the ground."
A state Department of Environmental Quality employee attended the auction, and auction leader Nancy Schlichting took the unusual step of giving the winning bidder a chance for a study period, which will allow him to back out if environmental problems are found. Schlichting is allowing the real estate closing to wait until October.
However, Schlichting added, "There's no reason to believe there's any problem with the property."
With its distinctive sail-like canopy designed by architect Madison Spencer, Fuel Co. opened in the summer of 2003 to fulfill creator Patricia Kluge's vision for mixing fine foods and auto fill-ups. However, the place never appeared to catch on with consumers and closed four years later. Subsequently, Kluge went bankrupt.
The auction drew a crowd of about 50 people– although only six had registered as bidders, according to Schlichting, who advised that the winning bidder gets the gas pumps, the underground storage tanks, and the restaurant hoods inside. The rest of the fixtures and associated personal property are slated to be sold on July 28.
As for Desai's plans, he's keeping them to himself. Though he gave his age as 52, he declined even to mention what business interests he holds. However, an online search suggests that he owns the Seven Day Junior convenience store as well as at least one Subway sandwich shop.
The property– currently assessed for $1,134,600 and including about 3,700 feet under roof– was purchased by Kluge for $485,000 in 2002. After the 2007 closure, Kluge had the place listed for sale for as much as $1.9 million.
In a 2009 refinancing demanded by Farm Credit of the Virginias, the company that lent $35 million for her winery complex, Kluge committed the Fuel property as additional collateral, according to Schlichting.
"We thought it was worth a maximum of $700,000," says local businessperson Keith Rosenfeld, who began purchase negotiations in the summer of 2009, but backed out when he learned that City building code required an elevator if he erected a second story.
"That was a budget-buster for us," says Rosenfeld, "but that's a very strategic location."