Good Morning
Good Morning

Allegria Hotel to be bought for $27.4 million by its lender

The Long Beach boardwalk runs behind the Allegria

The Long Beach boardwalk runs behind the Allegria Hotel. Credit: Barbara Alper

The mortgage lender for the Allegria Hotel in Long Beach agreed to pay $27.4 million to buy the hotel at auction on Tuesday.

The lender, Stabilis Fund IV LP, bid for the 143-room property at a bankruptcy auction conducted by Central Islip-based Maltz Auctions. The bidding started at $24 million.

The pending sale is scheduled for a court hearing on Tuesday before a federal bankruptcy judge in the Southern District of New York in Manhattan. The sale is expected to close in October.

The oceanfront hotel on the boardwalk remains open for guests and events, according to Maltz Auctions. Rooms on the hotel website start at $275 a night. Hotel officials said all events will be honored and business will be uninterrupted.

“We believe strongly in the potential of the Allegria Hotel and, if the trustee approves the sale process, we look forward to making capital improvements and other investments in the property,” Stabilis officials said in a statement. “We plan to establish the Allegria as a truly top-notch boutique hotel.”

It has about 150 full-time and part-time employees, bankruptcy trustee Kenneth Silverman said earlier this year.

The company that runs the hotel, Alrose Allegria LLC, filed for Chapter 11 bankruptcy protection in July 2015. The filing came after a third of the hotel’s rooms were seized by the New York State tax department for $6 million in tax debts and interest.

Stabilis, an investment fund associated with Stabilis Capital Management LP, in Manhattan, is the successor to previous lender Brooklyn Federal Savings Bank.

Stabilis filed a foreclosure lawsuit in December, stating it was owed $31.7 million plus interest and fees.

The New York Department of Taxation and Finance reported Tuesday that hotel owner Allen Rosenberg still owes more than $6.3 million on 25 open warrants.

The bankruptcy filing does not forgive debt related to sales or withholding taxes.

The sale includes both the hotel and the property, which was owned by Rosenberg’s separate company, Alrose King David.

This is the second bankruptcy for Rosenberg, who previously filed for bankruptcy protection in 2011.

Rosenberg did not return calls for comment Wednesday.

More news