Raleigh hotel sold for $1.5M at auction
Posted December 15, 2010 1:25 p.m. EST
Updated December 15, 2010 6:17 p.m. EST
Raleigh, N.C. — The Capital Plaza Hotel in north Raleigh sold at auction for $1.5 million on Wednesday morning.
The price was significantly less than its $5 million assessed value, but the current owners were eager to sell the property.
The hotel, at 2815 Capital Blvd., just north of Interstate 440, opened in the 1970s as a Holiday Inn.
In the past 30 years, it has seen several different owners and names.
Under owners Govind Chandak and Sanjay Mundra, the property became a Doubletree Hotel before closing its doors in 2000.
In 2004, it reopened after a $1 million renovation as the Hotel Europa. Less than a year later, the hotel closed after Chandak sued the hotel manager for thousands of dollars in unpaid rent. The manager later pleaded guilty to tax evasion charges.
Accredited Medical purchased the property for $6 million in early 2006, with money borrowed from National Financial Lending, Wake County property records show.
After signing a licensing agreement with Ramada Worldwide, the California-based group had plans to renovate the hotel. Those plans were scrapped after Accredited Medical filed for bankruptcy in 2007 and closed the hotel.
The hotel was foreclosed on and purchased by National Financial Lending for $8.2 million at a public auction in May 2007. It has remained closed since.
On Wednesday, the building was filled with broken glass, graffiti and torn pages from the Bible.
The security company that monitors the hotel said it has become a haven for vagrants, vandalism and other illegal activity. New owner Bill Brar said he hopes to change that.
"It'll be far better than any hotel in the area. That, I can promise," he said.
Brar, who also manages a Doubletree Hotel in Fayetteville, said he hopes to open up a state-of-the-art hotel within a year.
Nearby businesses hope Brar can make the hotel a success.
"We need more business. The area has been in shambles for the last four years," said Frank Haidar, owner of nearby Warp Computers.
In the past, Haidar said when business has been good for the hotel, it was also good for him.
"If it is successful that means more people will come to it and more people come to us," he said.