Grand Boulevard Hotel seeks to stop auction

An official of the Grand Boulevard Hotel (GBH) yesterday asked the Manila City Hall to respect the “stay order” issued by a Manila court and put on hold its plans to auction the property on Oct. 26.

GBH general manager Flemming Nielsen said Manila Mayor Alfredo Lim should not take any action against the hotel since there is reportedly a standing “stay order” covered by the Interim Rules on Procedure on Corporate Rehabilitation that was implemented last Oct. 18, 2004.

The order was imposed by Manila City Regional Trial Court (MCRTC) Branch 24, asking the city government to hold the planned auction in abeyance.

Nielsen said the corporate rehabilitation rules state that the “stay order” shall be effective from the date of its issuance until the dismissal of the petition or the termination of the rehabilitation proceedings.

“Under the rehabilitation laws, the hotel is given a number of years to settle its dues. There is also already an ongoing effort to issue payment checks to suppliers, and pay the past water and electricity bills,” he added.

Nielsen said both parties should wait for the decision of the Supreme Court, which would give the final ruling if the auction should proceed.

The MCH earlier said that they are contemplating on taking over the hotel, formerly called Silahis International Hotel Inc., and put it up for auction, tentatively scheduled on Oct. 26.

Ricardo de Guzman, chief of staff of Manila Mayor Alfredo Lim, said the hotel failed to pay P176 million in real property taxes and business permit fees for the past several years.

When asked what would happen if Manila holds the auction, Nielsen said “it is not going to happen, they cannot do that. They would need a court order and they would have to close the hotel.”

He said the publicity over the issue has affected their operations.

“There has been a significant effect on the travel agencies since they heard that we are closing down. There has been a significant decline in our revenue and occupancy rate,” he said.

As to reports that they removed a “closure order” posted by a Manila sheriff, Nielsen said they were only following the instructions on the court order. The local government placed the order because the hotel was allegedly operating without the necessary permits.