May 25, 2011

Article from Crains’s Detroit Business – When the U.S. Marshals say “sell”….

Daniel Duggan

May 24, 2011 1:45 PM


It was a case of Medicare fraud, seized assets and a man who was sent to jail.

But at the end of the case, someone still has to help clean up the mess. In this case, that meant two brokers had to sell a strip mall seized by the government.

Over the last half-a-year, Terrance Bixler and Steve Valli of Thomas A. Duke Co. helped the U.S. Marshals Service sell a 25,000-square-foot strip center in Canton Township as one of the assets seized in the case.

It was a job that came seemingly out of the blue with a call from the U.S. Marshals, Valli said.

It seemed the government needed to have a building sold and had heard good things about Bixler and Valli in regards to the Canton-Northville area.

“They flew in, met with us and hired us,” Valli said.

Not too concerned with the back story, Bixler and Valli started marketing the building.

It was a rare occasion where commercial real estate needs to be liquidated as part of a fraud case. The past owner was a guy named Ali Makki.

Makki, as it turned out, had been skirting the law when it comes to billing Medicare. In July, 2010, he pled guilty to one count of health care fraud, one count of falsifying an immigration document and one count of falsifying a tax return. Note: he was originally charged with 40 counts, according to the 2006 press release, accused of $500,000 in over billing.

He was sentenced, in October, to two years in prison and a fine of $144,000.

According to court documents filed with U.S. District Court in Detroit, he had been charging the government for health care services not performed or not needed. He was also, according to the charges, signing-off on the documents needed for people to immigrate to the United States without actually seeing the people.

In 2006, the US Immigration and Customs enforcement put out a press release laying out the accusations. Namely, Makki gave a clean bill of health to 512 Green Card applications, when he didn’t test them. He also reported two people did not have syphilis when they had tested positive, according to the press release. Read the press release for yourself here.

And with this money he was making, he also purchased the retail center.

The U.S. Marshals got a court order in June, 2010 in U.S. District Court to have the retail center put under their control as part of a civil case against Makki.

But bad Medicare ethics and government charges were far from Valli and Bixler’s minds. They put up the listing and started doing tours.

And as oddly as they got the listing, they found a buyer as well, five months later.

Out of the blue, again, the phone rang and it was a prospective buyer. He’d driven by, saw the strip center and the sign and made a call.

The buyer, according to CoStar Group LLC, was Haggerty Palmer Associates LLC. According to state records, the owner of the LLC is Doraid Markus.

The properties located at 1735 Haggerty, 1791 Haggerty, 41128 Palmer Rd and 41212-41266 Palmer Rd go as Palmer Crossing.

In this market, they were able to sell the buildings after 5 months of marketing. And while it has CVS as an anchor tenant, the center still has a quarter of the space vacant with more soon-to-be vacant.

Amidst the headwinds, it sold for $2.5 million, or $100 per square foot — double the average price per square foot for a retail building, according to CoStar.

When I spoke with Valli about the deal, he said it was interesting to work on, but dealing with layer after layer of government agency on the sale was a slow process.

“There was a national group, a local group, an agency that acted as a real estate entity,” he said. “It was interesting, but it was a slow process.”

I asked Valli if this was the craziest deal he’s ever worked on.

“Not even close,” he said laughing.

He said I’ll have to read about the rest of the crazy deals when he writes a book someday. If they’re like this one, it’s a book I’d definitely read.

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