An article in Tuesday's Business section incorrectly reported who appointed a receiver to run the Sheraton Towson hotel. The receiver was appointed by Baltimore County Circuit Judge Leonard Jacobson.
+ The Sun regrets the errors.
The Sheraton Towson hotel has been placed in receivership after a partnership led by bankrupt developer Lawrence Rachuba fell behind on the payments on a loan of more than $50 million.
Raymond C. Nichols, chief executive of Atlantic Auctions Inc. of Baltimore, has been appointed to oversee the operation of the hotel, said Lawrence D. Coppel, an attorney representing Mr. Rachuba. Maryland National Bank sought to have the hotel placed in receivership, and the move was approved last week by a Baltimore circuit judge.
FOR THE RECORD - CORRECTION
But Mr. Coppel said the bank did not foreclose on the hotel or the office space and parking garage that were built as part of the same complex.
Those properties continue to be owned by Dulaney Valley Limited Partnership, in which Mr. Rachuba is a one-third partner. Until recently, Mr. Rachuba kept his own office in the complex, but Mr. Coppel said the developer has moved to smaller #F quarters.
Despite Mr. Rachuba's personal bankruptcy filing, Dulaney Valley Limited Partnership is not bankrupt, Mr. Coppel said.
Mr. Coppel said the partnership owes Maryland National Bank about $43 million for the hotel and office building and about $10 million that is backed by the garage.
"The action by the bank shouldn't have any effect at all on operation of the hotel," Mr. Coppel said. "If anything, the bank's action could make the project stronger."
Mr. Rachuba and his wife, Diane, filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code July 18. Rachuba Enterprises Inc. also filed for Chapter 11 the same day.
Documents in the bankruptcy case put the Rachubas' debts, and the debts of businesses they are involved in, at more than $250 million. That number far exceeds their own debts, however, because they have many partners in their real estate dealings.
Two other Rachuba businesses were forced into involuntary bankruptcy reorganizations Nov. 13 by Mrs. Rachuba's father, Ralph DeChiaro.
JTC Maryland National spokesman Daniel G. Finney declined to comment, saying the bank doesn't doesn't discuss specific customer relationships.