The District government will try once again Friday to auction some of its surplus real estate, but city officials are making no promises that this sale will be any more successful than the last one.
An attempt to sell 17 surplus tracts in September ended in embarassment when nobody bid on most of the parcels. Instead of the $9.3 million that city officials were counting on to help balance the 1981 budget, the sales totaled $2 million.
This time 10 properties are going on the block, a ragtag real estate portfolio that ranges from the $4 million Georgetown incinerator site to a vacant row house on Capitol Hill.
If all of them are sold for the minimum prices the city is asking, the District's coffers will be enriched by at least $5.59 million.
But city officials--who were so optimistic about the last sale that they counted on the cash to balance the 1981 budget--are being far more cautious this time.
"If we sell one or two, we'll be delighted," said Jean Oliver, director of the city's surplus property office.
"The important thing to remember is that people aren't selling anything right now," he added. "The market stinks. It's hard to tell what will happen."
Potential buyers have lined up to look at the more attractive properties on the city's list, but that doesn't mean they're going to bid, Oliver stressed.
Drawing the most interest is the Georgetown incinerator, a block-square hillside in the midst of Washington's most rapidly developing neighborhood, he said.
Leonard Melrod, a Washington attorney representing clients who considered bidding on the incinerator in September, said he doesn't know if they are still interested. "I have a feeling they're not going to bid," he said.
Melrod said the group he represents made a deposit on the incinerator site the last time, but withdrew from the sale. He said one factor that discouraged the bidders was the city's demand that the land be paid for within 60 days after the sale. It's impossible to put together financing on such a big project that fast in today's market, he explained.
High interest rates make financing costly, and the recession adds uncertainty to the prospects for using the land, Melrod noted.
To encourage bidders, the city has changed the rules to give buyers more time to find a mortgage. Instead of 60 days, the city is willing to wait 180 or even 240 days to close the incinerator sale, Oliver pointed out.
While sealed bids were taken on some properties in the prior sale, city officials are holding public auctions on all 10 tracts this time. Five parcels will be auctioned at 2 p.m. Friday in the city council chambers of the District Building, and five more will be sold a week later.
City officials have made public the minimum bid they will accept on the properties to be sold this time, something that was not done for all properties in the previous sale.
The minimum bids start at $30,000 for a vacant house at 403 11th St. NE, and range up to $4 million for the abandoned incinerator. Also to be auctioned Friday are the Morgan school annex at 2428 17th St. NW, with a minimum price of $230,000; vacant land on H Street NE between 2nd and 3rd Streets, minimum $200,000; and a police station at 2301 Martin Luther King Jr. Ave. SE, minimum $40,000.
A week later five more properties go on sale with these minimum bids: Morse School, 440 R St. NW, $130,000; Police Precinct 9, 529 9th St. NE, $140,000; Eckington School, 1615 First St. NE, $180,000; Crummel School, 1900 Gallaudet St. NE, $570,000; and vacant land at South Capitol and M streets SW, $75,000. CAPTION: Picture, Morgan School annex at 2428 17th Street NW is among five properties being auctioned Friday. The minimum bid: $230,000. By Douglas Chevalier -- The Washington Post