Society Hill inn to be sold at auction

April 14, 1994|By Timothy J. Mullaney | Timothy J. Mullaney,Sun Staff Writer

The Society Hill hotel and restaurant in Mount Vernon will be auctioned April 29, two years after the owners of the elegantly restored 15-room inn stopped making payments on a mortgage from the pension fund for Baltimore's police and firefighters.

The foreclosure had been delayed by a bankruptcy filing by Society Hill Associates L.P., the partnership that redeveloped the hotel and granted the mortgage lien to the pension fund in 1983.

But last October, U.S. Bankruptcy Court Judge James F. Schneider agreed to lift the automatic stay that bars creditors from seizing assets of debtors in bankruptcy, allowing the foreclosure.

The mortgage had been paid down to $453,985 in principal before the owners suspended payments in March 1992, according to papers filed in Baltimore Circuit Court. But interest and penalties have brought the debt to $568,700 as of December, the filing said, with interest piling up at $180 a day.

"Respondent admitted that the value of the . . . property is significantly less than the amount presently outstanding under the note," the court papers said.

The hotel was the brainchild of Thomas Kleinman, a Philadelphia developer who runs a Society Hill inn in that city as well. He also developed the Society Hill Hotel-Hopkins on St. Paul Street. Neither of the other properties is affected by the Biddle Street foreclosure, said James Wright, an attorney representing the pension fund.

The hotel occupies the 162-year-old former home of Maj. Thomas Biddle, a prominent Union officer during the Civil War. The property was an apartment building before Mr. Kleinman bought it in 1983, renovated it and reopened it in 1984.

Lawrence Yumkas, an attorney who represented Society Hill Associates in its bankruptcy proceeding, said last year that the hotel's restaurant, Grille 58, had been hurt by the recession, lagging convention business and poor traffic in the neighborhood, which sits on the northwest fringe of downtown, across from Meyerhoff Symphony Hall and near the Lyric Opera House.

Mr. Kleinman and innkeeper Kate Hopkins could not be reached yesterday.

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