The Embassy Suites Hotel in Hunt Valley has become the latest Baltimore area hotel property to go on the auction block, following foreclosure proceedings initiated by Perpetual Savings Bank.
Atlantic Auctions is scheduled to sell the 223-suite hotel at auction on the steps of the Baltimore County Courthouse, 401 Bosley Ave., at 11 a.m. Friday.
The auction comes less than a month after the 250-room Timonium Plaza Holiday Inn was sold at auction to First National Bank of Maryland. The lender had earlier foreclosured on the hotel's owners, a group headed by New Jersey businessman Fred Lafer.
In December, the Towson Sheraton Hotel was placed in receivership after its owners fell behind on payments on a loan of more than $50million. In that case, the prime lender, Maryland National Bank, has not foreclosed on the owners, a group called the Dulaney Valley Limited Partnership.
Located at 213 International Circle, near Interstate 83 and Shawan Road, the Embassy Suites Hotel opened in late 1985 and contains an indoor pool, steam room, whirlpool, restaurant and bar in addition to the 223 guest suites. It is a franchise operation that is managed by Embassy Suites Inc. of Dallas but ownedby a group called Midwestern Land Development Corp. of New York.
A representative of Midwestern Land declined to comment on the auction, and representatives for the bank and its trustees could not be reached.
Dan Nicol, vice president and general counsel for the Embassy Suites chain, which owns or operates 94 hotels nationwide, said he understood Perpetual took the action it did because the owners defaulted on their loan payments. He said he did not have exact occupancy rates for the hotel but is aware that it has faced stiff competition.
"That hotel is in an extremely tough market," he said. "It is a market that is probably overbuilt for the demand that exists. That hotel is in a very tough, very competitive situation."
Other hotels in the Hunt Valley-Timonium corridor include the Hunt Valley Inn, the Hampton Inn on York Road, the Marriott Courtyard in Hunt Valley and the Day's Inn and Holiday Inn in Timonium. Together, they contain more than 1,000 rooms.
Mr. Nicol and the general manager of the Embassy Suites Hotel, John Jagunich, said the Hunt Valley hotel is open for business as usual despite the pending auction. Mr. Nicol said Embassy Suites has a contract that calls for it to continue to operate the hotel if the bank acquires it at auction.
Any new buyers would have to make separate arrangements with Embassy Suites Inc. if they wanted to continue the current licensing and management agreement, he said.
Embassy Suites is not a prospective purchaser of the hotel, Mr. Nicol said.