Farnam Founder Tops Foreclosure Auction

Investors from Madison, Meriden, Orange, Fairfield, and Westchester County crowded into a Wooster Square parking lot to try to buy a tax-foreclosed carriage house-turned-condo.

The winning bidder: A local real estate broker whose growing business’s signs dot downtown and East Rock.

But winning the auction might not end up meaning obtaining the property.

That was the outcome Saturday in the surface parking lot behind the three-story Art Deco condo building at 576 Chapel St.

Nearly a dozen hopeful buyers gathered there just before noon with their friends and spouses at a foreclosure auction to put in bids. They were vying to purchase not the former Lupoli Brothers funeral home building that looks out on Wooster Square, but rather the two-story, two-bedroom carriage house that stands just behind it off of DePalma Court. 

Though detached, that building is part of the same eight-unit condo complex as its Lupoli neighbor.

According to state court records, the City of New Haven filed a tax foreclosure lawsuit against the carriage-house-condo’s owner — a New Jersey-based holding company called TYZ II, LLC — back in April 2022 because of the owner’s failure to pay two years worth of taxes. 

A November 2022 affidavit by the city’s tax collector stated that the condo’s owner owed more than $20,500 in back taxes, interest, and lien fees at that time. A Feb. 27 appraisal put the residential property’s market value at $345,000. The current owner, meanwhile, first bought the condo in August 2020 for $322,000, and the city last appraised it for tax purposes as worth $368,700.

As the foreclosure auction neared its noon start time on Saturday, investor after investor walked up to get in line and register with local attorney Earle Giovanniello, who presided over the sale.

Giovanniello let each potential buyer know that the city, as the plaintiff in the foreclosure lawsuit, had put in an opening bid of $30,000. That amount was roughly equal to what the current owner owes when taking into account newly owed taxes incurred this year, and that would be the starting price at Saturday’s auction. 

The attorney said he did not know if the property was currently occupied. (Giovanniello said he knocked before the start of the auction, and no one answered. Some of the attendees at Saturday’s auction speculated that the property was used as an AirBnB short-term rental. Some suggested it was vacant. Some were confident it’s currently being rented out.)

He let the bidder-hopefuls know that whatever happened at the auction, the current owner would likely hold onto the property. 

That’s because the current owner had told him the day before that she plans to ​“redeem” the property — meaning that she plans to pay off her tax debts and other necessary costs before the end of the state-mandated ​“redemption period.” If she followed through on that promise, then she would continue to own the property, and the high bidder at Saturday’s auction would get their check back and walk away empty handed. Update: On Monday, the city filed a ​“Satisfaction of Judgment” in the foreclosure case, indicating that the property owner had ​“paid in full” its debts to the city. That means the owner should be able to hold onto the property.

That likely property-redemption notwithstanding, 11 bidders signed up for the auction anyway to take their chance and try to snag the Wooster Square condo. 

“We’re just investing,” said Fairfield-based architect Yengming Lee, standing alongside his wife and real estate agent Caroline Chao.

“We enjoy New Haven,” Lee said. It’s ​“friendly, walkable, a lot of dogs.” He and Chao said the proximity to Pepe’s pizzeria on Wooster Street and to Wooster Square Park made this Chapel Street condo a particularly attractive property to bid on.

“It’s a nice neighborhood,” New Haven native and current Meriden-based real estate investor Ray Smith said about why he showed up to Saturday’s foreclosure auction. ​“I love New Haven.”

Rory Hernandez said he drove up from his home in Westchester County to try to buy the Chapel Street condo on behalf of his company, MEM Flip. ​“It’s a family-owned business,” he said.

“I like the area. It’s a cool property,” said Madison’s Alex Opuszynski, whose real estate investment company won permission last year to build 15 new apartments on Upper State Street. He said he recently purchased a rental property nearby on St. John Street and is currently undertaking a ​“total gut job” on those apartments. Appraising the historic brick converted carriage house, Opuszynski said it called to mind the current statewide and nationwide debates around accessory dwelling units (ADUs) — fondly describing the property before him as a ​“fancy” and ​“elaborate garage” that has been turned into a place to live.

Carol Horsford, the founder and owner of Farnam Realty Group, was one of the last potential bidders to arrive and sign up before the noon auction start time. ​“There’s a low starting bid. We’ll see how much people will pay,” she said about the coming auction. If she won and took ownership of the property, she said, she’d look to ​“put it back on the market for a homeowner” to purchase and live in.

Just after noon, Giovanniello addressed the crowd gathered in a semi-circle before him, explained the tax debts owed and the city’s starting $30,000 bid, and opened the auction.

“$31,000,” Opuszynski called out.

“$40,000,” piped in Smith.

This is going to take a while, Giovanniello said with a smile. Any other bids? This property is worth close to $400,000.

“$200,000,” said a bidder who declined to tell the Independent his name, and who identified himself after each bid he placed by the number Giovanniello had given him for the auction, which was 6.

“$230,000,” replied Opuszynski.

“$240,000,” said Orange-based investor Fabricio Zelaya.

“$241,000, #6,” said the mystery bidder.

“$245,000,” said Zelaya.

“$247,000, #6.”

“250,000,” said Zelaya.

“$251,000, #6.”

“$252,000,” jumped in Horsford.

“$253,000, #6.”

“$260,000,” said Horsford.

There was a pause. Is that it? Horsford asked. “$260,000 is the present bid,” said Giovanniello.

No one else spoke up, and Horsford emerged as the high bidder and winner of the auction.

“I think it’s worth it,” Horsford said after the auction as she handed a check to Giovanniello. ​“It’s beautiful. Who doesn’t want to own a downtown condo in Wooster Square with a garage?”

See below for other recent Independent articles about foreclosures.

• Bank’s Bid Beats Local Buyers
• No Bidders Show For Newhall St. Auction
• Auction Keeps Owner In Neighborhood
• Auction Winner Remembers The Roses
• Homeowner Battles ​“Tangled Title” Foreclosure
• Foreclosure Sends Tenants Packing