EASTON — The Tidewater Inn, an anchor of the town center of this Eastern Shore community since the 1940s, was sold at auction yesterday for $4.225 million to a Montgomery County-based developer known for its residential projects in Fenwick Island and Bethany Beach in Delaware.
Carl M. Freeman Associates, a 60-year-old company with headquarters in Olney, has assured the town that the building will remain a hotel, Easton officials said. But a company spokesman declined to discuss plans yesterday. The red-brick Federal-style building is a half-block from Town Hall and across the street from the historic Avalon Theatre.
The auction on the Talbot County courthouse lawn drew about 200 onlookers. Included in the lunchtime crowd were many of Easton's most prominent business leaders and merchants, who have a stake in the commerce that the hotel has generated for decades by attracting overnight visitors, business groups, hunters and tourists.
When Frank Edwards, chief financial officer for the Freeman company, made the final bid, spectators broke into applause.
Nearly a dozen investors had registered for the sale, but the only other bidder at the end of the 30-minute auction was the Greater Atlantic Bank of Reston, Va., which holds a $5.3 million note owed by John M. Mervine Jr., the hotel's owner.
Edwards said the Freeman company, which owns and manages shopping centers and four golf courses, has investigated properties in and around Easton for the past several years.
"We're a diversified real estate company, and we have a sports and hospitality division," said Edwards, whose firm began building the high-rise Sea Colony condominiums in Bethany Beach more than 30 years ago and is developing the 1,700-unit American Bayside in Fenwick Island.
"We need to do more work with the town before we can get specific," he said. "We're always looking for the gem in any community, and the Tidewater is certainly the gem of Easton. You don't often get an opportunity for a property with that kind of character."
In recent years, merchants say they have watched a steady decline at the hotel and heard rumors that it would be converted to condominiums. Most say they are hoping for a turnaround that would restore the building that was known for its slogan, "The Pride of the Eastern Shore."
"Anything is better than what it is now," said Bruce Berrier, who owns a men's clothing shop just up Dover Street from the Tidewater.
Maureen Scott-Taylor, a town councilwoman who is a vice president and managing director at the inn, said Freeman officials were busy late yesterday, changing bank accounts and payroll procedures and other short-term details to keep the Tidewater operating through the busy fall season. Renovation plans might be ready by the first of the year, she said.
Al Bond, Easton's economic developer, said 30 to 40 potential investors have inquired about the hotel in recent months. He said the new owners could qualify for state and federal tax credits to renovate the building.
"What we really want to see is a successful, stable hotel operator - that's what's best for the town," Bond said. "The downside is they're developers, not hoteliers. But they have the talent and the capital to do it."