Foreclosure may be looming for Squamish's Holiday Inn Express as the facility went into receivership with unpaid debts totaling $11.7 million.
On Aug. 31, BC Supreme Court granted a court order to place Squamish JV Ltd. assets related to the Squamish Holiday Inn - amounting to $18,563,284 - in the hands of interim receiver Meyers Norris Penny Limited. Ian Mackin of Meyers Norris Penny could not be reached for comment.
Court documents indicate that Servus Credit Union Ltd. and Concentra Financial Services requested the court order since the Holiday Inn owes them an $8.9 million mortgage. Lawson Lundell lawyer William Roberts, who is representing the creditors, said he could not comment on the case.
The court order provides the creditors with the choice of waiting until the hotel owners refinance or sell the property, or forcing a sale or claiming the title.
Despite numerous promises of repayment from primary Squamish JV investor Brian Ostrander, the situation appears grim for the 15 local businesses, one individual and Squamish taxpayers, who together are owed more than $250,000.
Many of the creditors aren't holding out hope for full repayment.
"Someone will likely pick it [the hotel] up at a fraction of the cost," said Executive Suites general manager Kris Szylowski, whose business is owed $10,580.
Squamish JV owes $10,868,224 to secured creditors, four of them from Squamish. When and if the hotel sells, secured creditors are first in line to collect monies owed.
If the hotel sells for less than what's owed, secured creditors are paid in priority based on when they filed their complaints with the court.
Any money left over after paying secured creditors is pooled for the unsecured creditors and paid out proportionally to the amount owed.
Squamish JV owes $771,669 to unsecured creditors, including $94,631 to the District of Squamish, $36,117 to Squamish's Heavy Construction Link and $10,580 to Executive Suites Garibaldi Springs.
Szylowski said Executive Suites didn't manage to file a lien on time to get secured creditor status.
Calls to the district to determine why the municipality didn't take legal action were not returned by press time.
Szylowski assumes foreclosure is in the near future but said it's hard to estimate what the Holiday Inn is currently worth since hotel stays are down in Squamish and the number of rooms are up.
"Squamish hotels are struggling at the moment, but I think the industry in the area still has lots of room to grow," he said. "We have gone through a substantial increase in inventory over the past couple years and it will take some time for the demand to catch up with the supply."
Ostrander said as much during an interview with The Chief before the receivership.
"Why is there so much hotel vacancy in Squamish?" he asked.
Canada's Holiday Inn Worldwide director Stuart Laurie did not return calls to determine whether the Squamish Holiday Inn could keep the chain's name.
