Majestic mansion on auction block> Divorce, down economy, put prominent family properties in dire straits

A majestic mansion overlooking the Penobscot River in Hampden is quiet now, no longer carrying the voices of the town’s prominent Dyer family. Its walls, once covered with elegant paintings, and its floors, home to oriental rugs and antique furniture, are now all but bare.

Next month, the nine-bedroom mansion will go on the auction block, the result of poor investing, rising debts and a bitter divorce that has yet to fully play itself out in the courts. Other Dyer property, including a summer mansion on Schooner Head in Bar Harbor, face or have seen foreclosure proceedings by banks.

The Hampden mansion was home to John B. “Jack” Dyer, his wife, Pennye, and their daughter, Edythe, who was named for Dyer’s grandmother, Edythe L.R. Dyer, an heiress to the Cassidy lumber fortune. In 1983, the senior Dyer, now in her 80s, donated her house off Route 1A in Hampden to serve as a public library for the town.

At the first of three preview showings Sunday afternoon, the curious wandered about the Hampden mansion, opening closets and peering into some of the six bathrooms.

The voices of children echoed about the empty rooms as an autumn sun burst in through large windows. Below, the Penobscot River flowed quietly by.

The main section of the home was built in the 1930s, and Edythe Dyer’s section, larger than most houses, was added on in the 1980s. On the wall of the dining room is a mural painted by Ralph Dyer.

With polished wood trim, built-in bookcases, and fireplaces in many of the rooms, it is not the sort of place where one asks, “how much?”

The 10,000-square-foot property rests on 54 steep acres, including nearly 2,000 feet of shore front. Outside the residence is a large children’s playhouse — a castle. The house was once a stop on a sightseeing tour of elegant houses in the Bangor area.

The history behind the house and what has led up to its sale is as rich and colorful as the finery once contained in it.

Located on a significant site of the Red Paint People, who lived in Maine 2,000 years ago, the Hampden house purportedly was built by the late Ralph Dyer II, a colorful real-estate developer.

In 1958 and again in 1960, Ralph Dyer II ran unsuccessfully for the Maine Senate, running as a conservative Democrat, or Demopublican, as he called it. Some of his forays into real estate met with similar fates.

In 1965, he attempted to get land near the University College campus in Bangor rezoned so he could put in a service station. Ralph Dyer II sought to develop what is now Maliseet Gardens into a multistory hotel and civic center complex in the early 1970s. And the Bangor developer dreamed of putting in an office on the State Street Bridge over the small triangle of land in Kenduskeag Stream. Fires, both believed to have been set, damaged two of his properties.

Jack Dyer followed in his father’s footsteps and found success as well as failure.

In 1987, the family lumber mill in Greenville, bought two years earlier, was poised for expansion. For years, Dyer aggressively sought new properties and developments such as a $6 million condominium complex in Brewer and a $50 million wafer board plant for the towns of East Millinocket and Millinocket.

During a hearing in Superior Court in Bangor in March 1993, Pennye Dyer recalled her husband’s boasting of managing a $12 million portfolio for the family, including trusts set up in the early and mid-1980s. In good years, the portfolio was bringing in as much as $1 million a year, John Dyer acknowledged under questioning from Susan Kominsky, Pennye Dyer’s attorney, during the March 7 hearing.

The divorce, first filed by Pennye Dyer in Penobscot County District Court in Bangor in October 1992, continues on in Superior Court. Several hearings are still pending and won’t go before Justice Francis Marsano until after the first of the year.

Divorce documents shed some light onto the family and their lifestyle. It is unclear, however, how much property has been retained by the family, what remains in trusts, and what has been subject to foreclosure by banks.

But as late as last year, the family or trusts’ portfolios included: 2,400 acres in Mount Chase near Mount Katahdin; a 40-unit housing complex on Sunset Avenue in Bangor; a single-family home in Hulls Cove; small tracts of land in Dedham and Milbridge; an eight-lot subdivision in Greenbush; about 7 acres of riverfront property in Brewer, now in bank possession; more than 400 acres in Millinocket including 325 acres containing gravel, a site valued at as much as $5 million.

That doesn’t include the Hampden property now in the possession of Bangor Savings Bank and scheduled to be auctioned off Dec. 13 in Bangor. The land, mansion and smaller second house are assessed by the town of Hampden at more than $500,000. The Dyers’ mansion at Schooner Head is in the possession of United Bank and appraised by the town of Bar Harbor at around $850,000, but has received other appraisals at figures as high as $2.8 million.

In addition, Jack Dyer bought a building on Marlborough Street in Boston in April 1992 that contains several condos, including his own, and several others that rented out last year for $1,300 to $1,800 a month, according to his testimony.

In the late 1980s and early 1990s, property developments went sour. In the spring of 1988, Dyer stepped down as president of Dirigo Lumber Co., and the company closed in early 1989. He estimated he lost $2 million in the Greenville project. The condo project in Brewer and the wafer board project in Millinocket and East Millinocket were shelved.

Over the years, the Dyers sought to extend their credit and borrowed money from the banks, going deeper into debt, while, Dyer admitted, income-producing property dwindled. At a 1993 hearing, Dyer said the family overinvested in residential property, such as putting as much as $750,000 into their Hampden home in the 1980s. That problem “is now home to roost,” Dyer would say at the hearing.

“We are in an extreme state of financial distress,” Dyer said more than a year ago, saying that debt payments were as much as five months behind and that loans were in jeopardy of default.

Dyer faces at least three lawsuits including one filed in 1990 by Andrews Land Services Inc. in Millinocket, alleging Dyer has not paid $4,737 owed the company for surveying work. Two others were filed by Civil Engineering Services in Brewer alleging that the company is still owed more than $100,000 for work it did for Dyer. The town of Hampden has placed liens on the Hampden house and is owed more than $16,000, not including fees and interest.

“There is a wealth of assets, but we are swimming in financial problems,” Dyer said during his 1993 testimony. “If I had to do it all over again, I would never have permitted that kind of activity to go forward,” Dyer added.

Previews of the Hampden property will be held 2 to 3 p.m. Sunday, Nov. 27; and Monday, Dec. 5. The auction is scheduled for Dec. 13.