After struggling with bankruptcy for the past 19 months, Peerce's Plantation, the 64-year-old Baltimore County restaurant and caterer, will be put on the auction block June 14.
The auction, ordered by the U.S. Bankruptcy Court in Baltimore, will include the sale of the restaurant and catering facility, a 6,000-square- foot executive house where owner Peerce M. Lake lived, and an adjacent 14.74 acres of property. Also up for sale are its corporate name - Peerce's Plantation Inc. - and its 7-day class B restaurant license.
"We are getting a lot of action from both developers and restaurateurs," said Daniel M. Billig of A. J. Billig & Co. of Baltimore, which will conduct the sale. There is "approximately 2.5 acres of commercially-zoned land, probably the only piece of its kind in the Loch Raven watershed. It's got a lot of potential as a catering facility."
After filing for bankruptcy protection in October 1999, Lake, who was raised on the property, announced in March that the restaurant begun by his parents would close because of its financial difficulties.
Lawrence J. Yumkas, the lawyer for the restaurant, said Peerce's asked the court earlier this month to approve the auction. One of its creditors, First Mariner Bank, which holds the mortgage on the restaurant and the adjoining property, is seeking $1.2 million, Yumkas said.
"It's hard for a restaurant to regain its customers and catering customers when there's so much uncertainty," Yumkas said. "And without increasing income, Peerce's Plantation could not sustain its business profitability."
The 300-seat restaurant in Phoenix, situated along the Loch Raven Reservoir with a picturesque view, was a local destination for years, attracting events such as proms, weddings and retirement parties. Lake took over the restaurant from his parents in 1963 at the age of 21 and transformed it into an upscale restaurant.
Known for its lobster bisque and Chesapeake beef filet with crabcake, Peerce's offered continental cuisine with entrees ranging from $25 to $30. It hit its peak in the early 1980s, serving more than 400 dinners on Saturday nights.
While patrons were stunned when Peerce's filed for bankruptcy protection, many saw it as an inevitable step in the restaurant's slow and steady decline after the recession of the early 1990s.
Lake never recovered from the debt he incurred from various failed restaurant ventures, including Peerce's Downtown in Baltimore in the 1980s and Peerce's Gourmet in Timonium in the 1990s. He filed for bankruptcy hours before Peerce's was to be auctioned to recover about $1 million in debt.
Lake, who lives in Florida, said he wasn't sure if he would attend the auction. He declined to comment further.
Bruce Frankel, a 25-year veteran of the restaurant industry and operator of a Web site that helps start-up restaurant entrepreneurs, said the restaurant business is tough and competitive.
"I don't think there are any more high-end restaurants going out of business than in other [categories]," said Frankel, who is based in Boston. "Maybe if the economy continues to downturn, we'll see more of that."
He said independent restaurants that have been around for decades often face the danger of appearing "old and tired" to their customers. They have to be flexible enough to update their menu and the environment to keep their audience coming back, he said.
The auction is scheduled to begin at noon June 14. The restaurant building on Dulaney Valley Road sits on 1.8 acres.
Other buildings on the property include a two-story office building, a storage building and a two-story apartment building. All equipment will be sold in one lot.
The restaurant parcel has a minimum bid of $1 million, and the 14.74 acres of land has a minimum bid of $250,000.
The 6,000-square-foot house, built in 1991, has no minimum bid.