West Clay commercial building set for sheriff’s sale

  • Comments
  • Print
Listen to this story

Subscriber Benefit

As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
This audio file is brought to you by
0:00
0:00
Loading audio file, please wait.
  • 0.25
  • 0.50
  • 0.75
  • 1.00
  • 1.25
  • 1.50
  • 1.75
  • 2.00

A Class A office and retail building in the Village of West Clay tied to a state securities fraud lawsuit against three Carmel family members is set to be sold Oct. 3 in a sheriff’s sale.

The Indiana Secretary of State’s securities division in February filed the complaint in Hamilton Circuit Court against attorney Charles Blackwelder, his son Chad Blackwelder, and his daughter Cara Grumme. The three own CFS Inc., which also is named in the suit.

CFS was located in the Village of West Clay at 12821 E. New Market St., the address listed in the sheriff’s sale notice. The business described itself as a licensed brokerage that had provided “real estate investment opportunities” since 1998, according to the company’s website at the time of the charges.

The securities division accuses the three of selling $10.4 million in ownership interests in rental properties to elderly clients and misappropriating their funds.

The court appointed a receiver Feb. 20 to oversee CFS investor assets and issued a preliminary injunction barring the trio from selling securities pending the outcome of the lawsuit.

The sheriff’s sale is the first step by the receiver to attempt to satisfy roughly 150 claims brought by investors and debtors so far against CFS. About three dozen of the claims exceed $100,000—the largest being $415,000, according to court documents.  

Typically in sheriff’s sales, the lender on a mortgage will reclaim the building to protect its investment and will attempt to resell the building at a later time.

The mortgage holder for the 24,400-square-foot West Clay building, American Equity Investment Life Insurance Co., won a $1 million judgment against CFS in August, according to Hamilton County court records.

The West Clay property had an assessed value of nearly $3.8 million in 2011 and is home to several tenants, including Gottlieb & Wertz Inc., Crown Products & Services LLC, SK Huffer & Associates PC,  and Josh E. Brown LLC.

CFS’ portfolio contains 35 commercial and residential properties in the Indianapolis area valued at $7.1 million, the complaint said. It does not specify how much money investors have lost.

Receiver Mary Slade of Carmel law firm Drewry Simmons Vornehm LLP didn’t return phone calls seeking comment on the status of the remaining CFS properties that could be sold.

Among CFS’ commercial properties under court-appointed receivership is its building at 4905 E. 82nd St., whose tenant is the Ethan Allen Design Center.

Reached by phone, Mark Barnes, the lawyer representing Charles Blackwelder, said his client is cooperating but denies wrongdoing.

“He still denies he violated securities law,” Barnes said. “His position is that [real estate investments are] no security.”

According to the complaint, CFS did not register its securities offerings with the state, and Charles Blackwelder, who sold the securities, is not registered to sell them.

CFS’ assets include two other West Clay properties that formerly housed Harvest market and Chappie’s restaurant—both run by members of the Blackwelder family.

 

Please enable JavaScript to view this content.

Editor's note: You can comment on IBJ stories by signing in to your IBJ account. If you have not registered, please sign up for a free account now. Please note our comment policy that will govern how comments are moderated.

Get the best of Indiana business news. ONLY $1/week Subscribe Now

Get the best of Indiana business news. ONLY $1/week Subscribe Now

Get the best of Indiana business news. ONLY $1/week Subscribe Now

Get the best of Indiana business news. ONLY $1/week Subscribe Now

Get the best of Indiana business news.

Limited-time introductory offer for new subscribers

ONLY $1/week

Cancel anytime

Subscribe Now

Already a paid subscriber? Log In

Get the best of Indiana business news.

Limited-time introductory offer for new subscribers

ONLY $1/week

Cancel anytime

Subscribe Now

Already a paid subscriber? Log In

Get the best of Indiana business news.

Limited-time introductory offer for new subscribers

ONLY $1/week

Cancel anytime

Subscribe Now

Already a paid subscriber? Log In

Get the best of Indiana business news.

Limited-time introductory offer for new subscribers

ONLY $1/week

Cancel anytime

Subscribe Now

Already a paid subscriber? Log In