A Seattle investment firm, saying a key figure in the Silver Queen Hotel on Main Street owes $7,250,000 on their units in the building, is preparing to auction the condominiums off in a trustee’s sale in April.
A notice of default filed in the Summit County Recorder’s Office named Jana Potter and two business entities tied to the Silver Queen. The notice said the payments on the units have not been made on schedule. The deed of trust dates to 2008.
The president of the investment firm, John Hoss, said in an interview the full $7,250,000 was due to Olympic Coast Investment, Inc. on June 1, 2009. Hoss said the Silver Queen has not paid the principal and now owes interest payments as well. The trustee’s sale is scheduled April 1.
Olympic Coast is the lender on 10 of the 12 condominiums in the building and the commercial space on the Main Street level, Hoss said. If Olympic Coast completes its move against Potter and the business entities, it would be the majority owner in the building.
Should Olympic Coast auction the condominiums and commercial space in a trustee’s sale, Hoss said the minimum bid will likely be approximately $7.3 million. He said he does not expect the units will sell at auction, though, and his firm will likely operate the Silver Queen for an undetermined period of time.
He said if Potter sells the property or refinances in the meantime, the auction would be called off. According to Hoss, Potter did not obtain the loan to purchase the units in the Silver Queen but put the units up as collateral anyway.
Potter did not return phone messages seeking comment. The Silver Queen is operating as the April sale approaches.
The Silver Queen occupies a high-profile Old Town location at the busy Main Street-Heber Avenue intersection. Nightly rates for two-bedroom condominiums at the Silver Queen run as high as $925 during the Sundance Film Festival, according to the hotel’s Web site.
The Silver Queen is the most recent in a string of well-known Park City buildings that have encountered financial problems amid the recession.
A bank put the Claim Jumper building on Main Street up for auction in a trustee’s sale after the owner was unable to make nearly $7 million in payments A subsidiary of the bank entered the only bid, $5 million, in the Claim Jumper auction, and the sale drew only scattered interest from potential buyers. The Claim Jumper remains on the market.
The Silver Queen, though, might have advantages over the Claim Jumper since it is already operating as a condominium hotel. The eventual buyers of the gutted Claim Jumper would have to undertake a major renovation before the building could reopen in some fashion.
The Sky Lodge, across Heber Avenue from the Silver Queen, meanwhile, tangled with its lenders. The former owners of The Yarrow also encountered difficulties paying off a loan before the hotel was sold.