Astec Industries founder J. Don Brock sold his Missionary Ridge mansion for $1.3 million at a no-reserve auction that closed Jan. 10.
The sale was among the top residential sales in Chattanooga over the past year, but it was still $1 million less than the home's appraised value and $3.5 million less than its listed price.
The home was sold to Specialty Property Investments LLC, represented by Dalton attorney Tom Minor, who declined to comment on the sale. Specialty Property Investments is listed 1906 S. Hamilton Street in Dalton on the deed. That's the same address as AstroTurf, part of a family-owned business run by Thomas and Bryan Peeples.
The Peeples could not be reached for comment. Three bidders competed for the seven-bedroom, 10-bathroom estate at the December auction, according to Concierge Auctions, the New York-based auction company that's coordinated a handful of high-profile home sales in the Chattanooga region.
Chattanooga real estate agent Jay Robinson said he thought the Brock mansion, which features a 12-foot-deep indoor pool and 30-foot-tall solarium in the middle of the house, would sell for at least $1.5 million or more.
"I thought it would be in the high ones, so the price did surprise me," said Robinson, who specializes in high-end home sales.
The sale is another piece of Concierge's growing reputation in the Chattanooga area. In May 2013, the company auctioned an Ooltewah mansion at 2363 Heavenly View Drive that was listed for $5.3 million -- and cost $15.3 million to build -- for $3 million.
And in November 2013, the company auctioned a Soddy-Daisy lakeside estate that was listed for $2.8 million to a local buyer for $990,000. But that winning bid never closed.
"The buyer did not perform pursuant to the contract," said Laura Brady, managing director at Concierge Auctions.
So the 16-room home at 1997 Emerald Pointe Drive is once again heading to auction -- this time, the sellers set an $850,000 reserve. The auction will be held Thursday, and the deadline to register -- by putting a $100,000 deposit into an escrow account -- is today at 5 p.m.
Auctions are one way to tackle the challenges of selling luxury homes, which are often highly customized and appeal to a small market. Typically the more unique and expensive a luxury home is, the more difficult it is to sell, said Chattanooga real estate agent Grace Frank, with Re/Max Renaissance Realtors.
"A lot are custom-made and custom-built for a specific person," she said. "And when you take something like that out to the general market, it's a very small customer base who is interested in the home because it is so customized."
Only 19 homes were sold for more than $1 million in the Chattanooga region during 2013, said Frank Trimble, an affiliate broker with Keller Williams. He said it all comes down to supply and demand.
"With what's in the inventory in our area that you can get for $1 million to $2 million, you can have just about anything you want," he said. "You could have water front, you could have river view, you could have a golf course, you could have a farm. There are just so many choices out there right now, you've got to find that one buyer who wants to be in that spot. And with a 19,000-square-foot house, that's not everyone."
The sheer size of the Brock's mansion could be one reason the closing price was lower than many people anticipated, said listing agent Jack Webb, a real estate broker with Crye-Leike.
"One of the challenges of that house was the size," he said. "It narrows the market of potential buyers a good bit once you get up to a home of a certain size."
Another factor that could have impacted the auction's tepid result was that Concierge required all interested players to plop a $100,000 deposit into an escrow account, just for the right to bid. Robinson said he thinks that practice rubs Chattanoogans the wrong way, and added that some of his clients considered a bid but balked at the $100,000 requirement.
"I have clients who are very well-qualified who would have gone and even bid on that house, but they weren't interested because of the huge registration fee," he said."It's a quandary because I can understand why an owner of a home like this would want to be very particular about who can bid, but on the flip side, you need to throw it wide open."
Chattanooga agent Grace Frank, with Re/Max Renaissance Realtors, said she had an out-of-town client who was also interested in bidding on the mansion but decided against it when he found out about the $100,000 up-front reserve.
"It's like I'm interested, but maybe not so interested to set aside $100,000 of my own money," she said.
And that's the point of the deposit, Brady said.
"We feel that's a part of our vetting process for the auction to make sure bidders are truly interested and truly capable," she said.
She believes auctions are the best way to value a high-end, luxury property.
"It's difficult to say that just because the property was appraised for a certain amount or listed for a certain amount that it is worth that amount," she said. "But when you expose a property that much and have a roomful of interested people, you can feel confident that the price was fair on that day."
Webb said he considers the auction of the Brocks' mansion a success.
"From the standpoint of timing, if you will, it was successful because the sellers were ready to sell and move on," he said. "And it was as successful for the buyers because the buyers got a very nice home at a very good price. From that standpoint, I think it was a successful sale."
Contact staff writer Shelly Bradbury at 423-757-6525 or email@example.com.