The site of the former C. F. Donovan’s restaurant was sold last week at a sidewalk auction to the owner of McKenna’s, the café across the street, and a local financial planner.

The winning bid for the former restaurant, which longtime owner Arthur Donovan lost to foreclosure, was $875,000. The property comes with a liquor license, a tax lien from the state Department of Revenue, $6,297 in back taxes and outstanding water bills and sewer charges totaling $2,731.

“We’re doing it for the neighborhood,” said Ken Osherow, president of At Home Real Estate Group, which is located next to McKenna’s café. Osherow, who is also planning to open an ice cream shop down the street, initially said they were thinking of a “family” restaurant, later adding that it instead would have more of a trendy and modern atmosphere, and seek to attract both neighbors and non-locals.

“We saw an opportunity to do something good in our backyard,” said Driscoll DoCanto, a financial adviser with Merrill Lynch who is working with Osherow and lives on nearby Pearl Street. DoCanto and Osherow, a New York native, have known each other for years through the real estate business.
Located directly across the street from the Savin Hill MBTA station, Donovan’s quickly became a fixture of the neighborhood after opening in 2001. Donovan filed for bankruptcy in November 2009 and the property went to Mt. Washington Bank.

As the jackhammers a few feet away quieted for the Thursday morning auction, a crowd of 30 people gathered to watch. While five people had signed up to participate and bid, a bidding war erupted between Osherow’s group and Jim Paskell, an independent investor and developer who developed the eight condos across the street from the restaurant.

The crowd cheered and clapped after Osherow’s group won the auction. Don Walsh, who was in the crowd watching the auction, came up to Osherow and shook his hand.

Eric Robinson, of RODE Architects, a local firm, called the auction a “huge win” for the neighborhood. He said he will be working with Osherow on the new restaurant.

“We’re going to use all local people,” Osherow said.

Osherow made a trip to New York over the weekend and checked out some restaurants. He has also looked around at local restaurants for inspiration. “We went to about 15 restaurants all over Cambridge and South End, looking for concepts, décor and themes,” he said.

He said he hopes to have the new restaurant opened in the next several months.Osherow and DoCanto were represented by attorney Charles Tevnan.