A hotel receiver was appointed to oversee the management and operation of a new Radisson Hotel located in Menomonee Falls, Wisconsin. What makes this interesting from a receivership standpoint is that the operator, who was the motivation behind the investors wanting a receiver, is still managing the property. Typically, where there are troubled hotel loans or investors are not being paid as a result of how hotel property management services are handling those payments, that person or entity is the first to be replaced. According to the article in Hotel-Online on November 23, 2011 that was reported in the Milwaukee Journal Sentinel: “A statement village officials issued Tuesday said the receivership filing was supported by the hotel’s owners, an investors group led by hotel operator Dean Grosskopf, and by Minneapolis-based Radisson Hotels International Inc., which franchises the Radisson brand.” The news story also goes on to say that the hotel receiver appointed, Seth Dizard, is different than a prior nomination being sought by opposing parties: “Dizard’s appointment, by Waukesha County Circuit Judge Donald Hassin, pre-empts a rival request to appoint a different receiver for the 135-room hotel on Main St., just west of U.S. Highway 45. That request was made by investors groups that have filed a civil fraud suit in Dane County Circuit Court against Grosskopf’s ownership group, Lodging Investors of Menomonee Falls LLC. That receivership request has now been dropped, said Lawrence Drabot, Grosskopf’s attorney.” A separate story on this hotel court approved receivership talks about the need and reasons behind shifting control away from the hotel operator that would benefit repayment of the development loan. Are you a lender, investor or other development authority considering the appointment of a hotel receiver? Submit a request via the link below and we will provide a complimentary confidential consultation on your potential receivership.
