The Squamish Holiday Inn Express, which last fall was forced into receivership because the company that owned it faced shortfall on the hotel's $8.9 million mortgage and other debts, is now under new ownership.
Sandman Hotel Group on Wednesday (May 4) announced the acquisition of the 95-room hotel at 39400 Discovery Way, just off Highway 99. The hotel will be operated as the Sandman Hotel and Suites Squamish, officials said in a statement.
On April 13, the Supreme Court of B.C. approved the sale of the hotel to Northland Properties Corp., representing the Sandman Hotel Group, for $5.81 million. The sale closed on Monday (May 3), Ian Mackin of Meyers Norris Penney, the court-ordered receiver, said on Thursday (May 5).
After the property, then owned by Squamish JV Ltd., went into receivership on Aug. 31, 2010, the receiver put the property up for sale. The final sale price of $5.81 million "is slightly higher than what's in the receiver's report," Mackin said. "There were some negotiations during the court process."
Squamish JV Ltd., which built the Holiday Inn Express, was placed under court-ordered receivership with assets amounting to $18,563,284. Court documents indicated at the time that Servus Credit Union Ltd. and Concentra Financial Services requested that the court order the property into receivership because of an outstanding $8.9 million mortgage.
At the time, Squamish JV owed more than $10.8 million to secured creditors, four of them from Squamish, as a result of the debts incurred during the hotel's construction.
Before the hotel went into receivership, 15 Squamish businesses, one individual and the District of Squamish were owed a combined total of more than $250,000, The Chief reported last fall.
On Thursday, Mackin said the process of paying out creditors is still before the courts. He said the primary mortgage holder will likely receive the "lion's share" of the money from the sale and that there will then be an application to determine the "priority claimants," which would normally include the Canada Revenue Agency, B.C.'s Workers' Compensation Board (WCB) and others.
"There are second mortgage holders and lien holders that are registered after the first mortgage holder," Mackin said.
Smaller, unsecured creditors such as contractors who worked on the hotel "are not likely to get anything," Mackin said, adding, "at this point there's no likelihood that the unsecured creditors will receive any funds."
Salim Kassam, vice-president of marketing for Sandman Hotels, declined comment on the receivership situation other than to say that the opportunity to purchase the hotel was offered and Sandman's owners purchased it.
"It's always really unfortunate what happens with the creditors and the mortgage, but we can't comment on the receivership situation," he said.
"We feel really strongly about Squamish and about tourism in B.C., which is why we've purchased the property," he added. "We've met with all the staff and they seemed really happy. Lynne Park is the GM there. She's now part of our team and we're excited to now be part of the community."
The Executive Suites Garibaldi Springs was owed $10,580 by Squamish JV Ltd. Kris Szylowski, the Executive Suites' general manager, was quoted last fall as having said, "Someone will likely pick it [the Holiday Inn Express] up at a fraction of the cost."
On Wednesday (May 4), Szylowski said he hadn't heard anything about the terms of the sale, nor had he heard from the receiver about the next steps.
"It's [the hotel] obviously been foreclosed on and obviously sold, which is why it's now under new ownership," he said.
"It was most likely a cash sale. It sold for whatever it sold for and now it's up to the receiver to distribute whatever money there is to distribute from that."
In a statement, Kassam had glowing things to say about Squamish as a tourism destination.
"We are very excited to announce this acquisition, as it puts us firmly along the Sea to Sky Corridor. As the summer season is upon us, so too is tourism to the area," he said.
"The fact is, the District of Squamish is no longer a roadside attraction. Thanks to the massive exposure brought by the 2010 Vancouver Olympic Games, Squamish is now a destination for both tourists and locals. The Chief, the B.C. Mining Museum, the Brackendale Eagles Provincial Park are right there. This property is a wonderful option for folks who really want to explore and take advantage of all Squamish has to offer."
Those interested in the receivership proceedings can find the court documents at the Meyers Norris Penney website, www.mnpdebt.ca. Click on the "corporate engagements" bar, then P-T, and scroll down to "Squamish JV Ltd."
