Ladder Capital Finance LLC purchased the 14-floor, 179-room Crowne Plaza for $3.95 million on Wednesday at a foreclosure auction in front of the hotel's main entrance at 1 West St. The property's assessed value is $7.6 million, according to city records.
Ladder Capital, which had $2.4 billion in total loans listed on its balance sheet as of Sept. 30, currently operates a $79.6 million, 1,205 room hotel portfolio with properties in 11 states, according to its website. The company also owns BJ's Wholesale Club in Pittsfield.
"We kind of like the area," said CEO Brian Harris, who attended the State University of New York at Albany.
As the high bidder, Ladder Capital has essentially placed a deposit on the property — bidders were required to provide a $100,000 nonrefundable deposit on the 3.2 acre property in order to participate in the auction, The sale is scheduled to close within 40 days. Under the terms of the sale, Ladder Capital is required to provide an additional $300,000 toward the purchase price within five calendar days.
Adam Saltzman, who represented Ladder Capital at the auction, said he was not authorized to speak on behalf of the company.
"Usually, we wouldn't get into that until after we closed on it," Harris said. "Right now all we have is a deposit."
Ladder outbid a group headed by a New York City man, Anil Sachdev, who owns several hotels in both New York state and Vermont. Sachdev's group, which didn't enter the bidding until the price reached $3.6 million, dropped out at $3.9 million. The bidding began at $2 million.
Sullivan & Sullivan Auctioneers of Sandwich declined to say how many bidders registered for the auction, but four groups participated in the bidding. One of those bidders, Royal Property Group, a limited liability corporation based out of Cheshire. Royal dropped out at $3.4 million.
A publicly traded company, Ladder Capital wrote the mortgage for Trump Tower, but has since sold it, Harris said.
Ladder's assets include office, retail, industrial, multi-family, hotel and mobile home parks, according to the company's website.
The auction was scheduled after Santander Bank of Boston, which held the Crowne Plaza's $16.5 million mortgage, initiated foreclosure proceedings against the co-holders of the note, Berkshire Common Corp. and Shireberk Corp., on Jan. 5, according to documents on file at the Middle Berkshire Registry of Deeds in Pittsfield.
Both Berkshire Common and Shireberk, which have the same officers and directors, were "involuntarily dissolved" by the state of Massachusetts last June for failing to file annual reports, but have been allowed to conduct normal business operations. Neither entity has filed an annual report with the state since 2012, according to the Secretary of State's office.
The late Eugene Weiss of Schenectady, N.Y., listed in papers filed with state as the president of both Berkshire Common and Shireberk Corp., purchased the Crowne Plaza for $10.3 million from the Berkshire Life Insurance Co. in 1986. Weiss died in 2014. The hotel underwent a $1 million renovation when it changed from a Hilton franchise to the Crowne Plaza in 1997-98.
Reach Business Editor Tony Dobrowolski at 413 496-6224.