Baton Rouge reaches out to New Orleans business to sell adjudicated properties

    Seeking help to sell adjudicated properties, officials in the East Baton Rouge Parish Attorney’s Office have partnered with a New Orleans-based company that specializes in moving adjudicated properties and assists potential buyers with the required paperwork.

    Baton Rouge has more than 4,000 adjudicated properties, meaning properties relegated to the city-parish after the owner failed to pay the property taxes and no one purchased that property at a tax sale. Of those 4,000 properties, more than 2,100 have been adjudicated for more than five years and are now available for purchase through Civic Source’s website.

    “The hope and theory is it get it put back into commerce,” says William R. Aaron II, special assistant parish attorney and head of adjudicated properties in the Parish Attorney’s Office.

    Some of those properties are ditches in a subdivision and some are discarded parcels left over when a large tract was subdivided, while others have been adjudicated by mistake, Aaron says.

    If a potential buyer tries to purchase the property through the Parish Attorney’s Office, they are required to do all the legwork of finding past owners and notifying them through notices of the impending sale. Civic Source does the due process work for the buyer, and also offers title insurance.

    Title insurance protects the purchaser from unforeseen mortgages and liens, as well as legal attacks from a former landowner who was not notified of the property’s sale.

    Civic Source is handling only property that has been adjudicated for more than five years. That time distinction is important because when someone wants to purchase a property that has been adjudicated for less than five years, a public notice has to be posted for six months. After five years, the public notice is 60 days.

    Aaron says since the properties went up on Civic Source’s website Monday, they have already seen scores of people head to the Parish Attorney’s Office to settle their affairs and redeem the property. One employee was out one day earlier this week and had 60 messages left on her phone when she got back the next day.

    The city-parish does not pay Civic Source a penny for the service, Aaron says. The company sets the initial price of the property to cover its expenses, and makes its money through closing costs, Aaron says. Any money generated above the initial price goes to the city-parish.

    Brian Danos, chief operating officer for Civic Source, says the people using their website are a mix of investors looking to purchase land in bulk and people in neighborhoods who tire of seeing blighted property and buy the land to clean it up.

    “A lot of these properties are blighted properties and they are really harmful to these neighborhoods,” Danos says.

    In 2015, the company sold 645 properties in New Orleans and other parts of the state to new buyers and had former owners pay off the taxes to redeem 70 properties.

    Danos says it takes the company about 120 working days from the time a potential buyer pays a $750 deposit and expresses interest in buying a property to the date on which the actual sale is held. At the sale, anyone is free to bid on a property, Danos says. If the person who paid the deposit is not the highest bidder, then the company refunds their deposit and adds $750 to the total of the highest bidder.

    Danos says they will begin marketing the service in February to educate investors on how Civic Source works.

    “Every market we go into, it’s an education process,” he says.

    —Ryan Broussard

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