Quality Inn owner files bankruptcy again to keep second hotel

A planned trustee’s sale of the Sequim’s Quality Inn & Suites at Olympic National Park on Oct. 29 was a no-go after owner Bret Wirta previously petitioned for Chapter 11 bankruptcy to maintain ownership.

His bank, Wilmington Trust, planned a sale at the Clallam County Courthouse but Wirta’s filing in August sent him back to the U.S. Bankruptcy Court of Western District of Washington in Seattle to negotiate his options for the award-winning hotel.

For part of 2020 and this year, Wirta’s attorney — Tara J. Schleicher of Foster Garvey — sought a court-approved reorganization and repayment plan with the bank to maintain ownership of his other Sequim hotel, Holiday Inn Express & Suites at 1441 E. Washington St.

A plan was confirmed by a judge on July 14 in the U.S. Bankruptcy Court Western District of Washington.

Uncertainty with the COVID-19 pandemic and minimal hotel stays led to payment delays with full intention to pay the bank back, Wirta said in a previous interview.

Now he’s back in court after missing five monthly payments early in the pandemic, despite ongoing discussions with the same bank and resuming payments in October 2020, Wirta said.

For the Quality Inn’s ownership, Wilmington Trust serves as trustee for registered holders of Wells Fargo Commercial Mortgage Trust 2016-C35. Their representatives nor the attorney for the trustee’s sale returned requests for comment.

According to the trustee’s sale advertisement in the Peninsula Daily News, Wirta was delinquent about $448,000 and had to pay about $739,000 in payments and fees to reinstate ownership.

His loan amount is about $4.25 million, according to court documents.

Schleicher wrote in a court document, that on May 19, 2021, the bank “decided to suddenly cease negotiations and press forward with a hearing on (sending the hotel to receivership prior to a trustee’s sale).”

This led to the filing of a chapter 11 bankruptcy petition on Aug. 13.

“We had an oral and written agreement to pay them back (for the Quality Inn),” Wirta said in a recent interview.

“We were going back and forth in August and were told it would go to receivership and be sold on the courthouse steps despite payments being made.

“We stopped the receiver process by declaring bankruptcy again.”

Wirta added that the “bank has figured out how to make a lot of money off hoteliers across the country. I know I’m not the only one.”

Built in 2005

Sequim’s Quality Inn & Suites at Olympic National Park was finished and opened in 2005 at 134 River Road, with 60 rooms, an indoor pool, meeting space and a new pantry for guests.

It’s won seven Platinum awards in a row through parent company Choice Hotels International for being in the top 3 percent of the franchise.

The hotel employs 31 full-time and part-time employees, including about one-fourth of staffers developmentally disabled.

“(His wife Trisha) and I are very proud to have built a hotel like this in Sequim,” Wirta said. “At the time this was quite the risk. We’re proud of what we did, and I’m not going to let them take it away from us.

“We will fight this tooth and nail to keep it.”

He’s hopeful through court proceedings his case helps set a legal precedent that banks can’t take advantage of businesses during a pandemic.

Wirta also owns the Black Bear Diner at 1471 E. Washington St., and said he’s already paid back his regional bank deferred payments due to the pandemic, too.

For more information about the hotel, call 360-683-2800 or visit choicehotels.com.