B U F F A L O N E W S buffalonews.com
Updated: December 8, 2010, 08:47 AM
A foreclosure sale of the Holiday Inn Resort and Conference Center on Grand Island is scheduled for Jan. 11 in County Hall.
The 263-room property on Whitehaven Road continues to operate as a Holiday Inn hotel. It is being run by a hotel management company.
American Hospitality Partners bought the hotel from Lodgian in 2004. The Royal Bank of Canada, the mortgage holder, claims it is owed about $7.6 million and began its foreclosure action last March.
What might happen at the sale? The outcome varies depending on the bank, said Franklin Heller, a Damon and Morey senior partner who is not involved in the Grand Island case. “It’s basically a business decision,” he said.
If the bank determines that the property is realistically worth less than what it is owed, it could choose to submit a bid for less than the full amount. A competing bidder could then prevail, but the bank would trim its loss. “You have to decide how much you’re willing to walk away with,” Heller said.
If the lender prefers to take title to the property, it can bid in its full amount owed — or even add to it — to trump competing bids, Heller said. The lender could then hold on to the hotel until market conditions improve, to try to sell it for a better price.
Peter McMahon, Grand Island town supervisor, noted that the hotel is a popular spot for summertime tourists, as well as a gathering spot for local residents for banquets. Local residents also make use of its fitness center and pool.