While others heard the roar of a commercial real estate crash, auctioneer Bill Fox heard virtual silence yesterday as he asked for a $10 million bid on Baltimore Travel Plaza. It amounted to the same thing.
Maryland National Bank bought the East Baltimore combination of 10-story hotel, dinner theater, restaurant, nightclub, fast-food emporium, truck stop and bus station for $2.85 million, far less than the $11.9 million a development team led by now-bankrupt Lawrence Rachuba owed the bank. The travel plaza's value was once estimated to be as high as $30 million.
"Who will give me $10 million?" Mr. Fox asked as he tried to open the bidding. "Awful quiet," he said.
The first bid was only $2 million for the 5-year-old complex, whose former owners called off a 1989 auction when the top bid reached only $12 million, saying they didn't want to give the place away.
"If you want to buy cheap real estate, don't sit there with your arms folded," Mr. Fox exhorted the crowd of business people who had come to the O'Donnell Street plaza near Interstate 95 for the midday auction. "At these prices, everyone in the room should be bidding."
But hardly anyone was. The The complex lost $1.5 million last year, $1.9 million the year before and $4.7 million in 1989. The more recent losses are smaller partly because the plaza stopped making payments on its debts service, said Edward J. Levin, an attorney at Piper & Marbury who directed the sale after Maryland National foreclosed.
The partnership that built the travel plaza was forced into bankruptcy court protection in 1990.
The auction was planned in hopes of raising enough money to pay off a $10 million economic development revenue bond issued by Baltimor in 1984 to help pay for the plaz. The city sold the note to Maryland National, according to court records.