German financiers expect to control the Sky Lodge post-bankruptcy
An affiliate of a German firm that has interests across the globe expects to control the Sky Lodge when the Old Town property emerges from bankruptcy, the financial services provider said in a statement, apparently ending the uncertainty at the high-profile lodge that has stretched since the fall.
The firm, WestLB AG, anticipates the Sky Lodge will emerge from bankruptcy by mid-August, it said in the statement. The United States Bankruptcy Court-appointed trustee has agreed to the reorganization. The judge overseeing the case, R. Kimball Mosier, signed the confirmation order Friday, according to a court clerk.
The control of the Sky Lodge will transfer to WestLB AG from the Bill Shoaf-led Easy Street Partners. Shoaf has been involved since the development stages early in the last decade. He said he will remain a consultant for two years. WestLB AG and Easy Street Partners jointly filed the reorganization plan.
"We’re now completely recapitalized. I think it’s a great thing for Sky Lodge," Shoaf said.
WestLB AG expects to keep the Sky Lodge moniker. A firm called Gemstone Hotels & Resorts is under consideration to operate the lodge, a WestLB AG representative said.
Christian Ruehmer, a WestLB AG managing director based in New York, said in a prepared statement the firm "will work diligently to stabilize the business," market the Sky Lodge and "relaunch this 5-star property to prepare for a successful winter season in 2010-2011."
"We think this is positive for all participating parties," he said, calling Park City an attractive market.
The movement comes months after the Sky Lodge petitioned for bankruptcy protection amid a $5.6 million dispute involving itself, WestLB AG and another financial firm known as BayNorth Realty Fund VI. The two firms were Sky Lodge lenders, documents filed in the Bankruptcy Court indicated.
The Bankruptcy Court filing claimed WestLB AG mistakenly authorized a $5.6 million payment to the BayNorth Realty Fund firm from sales proceeds. As WestLB AG and the Sky Lodge tried to have the money returned, WestLB AG claimed the Sky Lodge had not repaid $4.9 million it owed and found it in default on the loan agreement.
WestLB AG froze accounts used to pay contractors, resulting in liens against the property, a Sky Lodge attorney said in September as the bankruptcy filing was made.
WestLB AG declined to discuss the dispute about the money that led to the bankruptcy filing. The Park Record was unable to contact a BayNorth Realty Fund representative.
The Sky Lodge occupies a high-profile location at the Main Street-Heber Avenue intersection, and it was among a series of exclusive lodging properties that appeared on the Park City scene during the economic boom in the years before the recession.
Support Local Journalism
Support Local Journalism
Readers around Park City and Summit County make the Park Record's work possible. Your financial contribution supports our efforts to deliver quality, locally relevant journalism.
Now more than ever, your support is critical to help us keep our community informed about the evolving coronavirus pandemic and the impact it is having locally. Every contribution, however large or small, will make a difference.
Each donation will be used exclusively for the development and creation of increased news coverage.
Start a dialogue, stay on topic and be civil.
If you don't follow the rules, your comment may be deleted.
User Legend: Moderator Trusted User
Gov. Cox announced that the state’s mask mandate in schools would end for the last week of classes. Park City School District officials strongly recommended that students continue to wear masks. South Summit officials anticipated they would not require masks for the final week.