Baltimore Travel Plaza will go up for auction Feb. 26, as financial troubles close in on an ill-starred combination of hotel, truck stop, night club and dinner theater in East Baltimore.
The law firm of Piper & Marbury advertised the property for auction just 10 days after a U.S. Bankruptcy Court judge dismissed the Chapter 11 action of Baltimore Travel Plaza, L.P., the plaza's owner. Controlled at one time by Towson developer Lawrence Rachuba, the partnership was forced into Chapter 11 in 1990 by DeChiaro L.P., a partnership led by Mr. Rachuba's sisters-in-law.
A Chapter 11 filing is designed to protect a company from creditors' actions while it reorganizes under court supervision. That process allows the company to hold on to as many assets as possible.
The Travel Plaza was a hotly anticipated project that opened in 1987, but has never done as well as a similar venture led by Mr. Rachuba and partner Garth Davis in Jessup.
By 1989, the owners had put the Baltimore property up for auction. But they rescinded the offer to sell it when the top bid was only $12 million, far below the $20 million they had suggested as a minimum bid.
Lawyers involved in the bankruptcy case couldn't be reached this morning for comment.
Last year, the partnership's attorneys said the Travel Plaza partnership's assets were $21,963,567, including about $18.7 million of land and improvements at the O'Donnell Street location.
Liabilities were estimated at $15.8 million. The biggest creditors were Maryland National Bank and First National Bank of Maryland, with combined debts of about $13.8 million.
Mr. Rachuba and his wife have also filed for bankruptcy court protection under Chapter 11, and Mr. Davis has filed for bankruptcy as well.
A trust set up by Mr. Rachuba's father-in-law, Ralph DeChiaro, to benefit his three daughters, is suing Maryland National Bank. The suit claims that the bank improperly allowed trust assets to be pledged as security for projects from which the trust had little to gain. That case has not yet gone to trial.