The Daniel hotel in Brunswick is headed for auction Sept. 17. Hannah LaClaire / The Times Record

BRUNSWICK — Brunswick’s The Daniel hotel is headed for the auction block later this month. 

The historic boutique hotel at 10 Water St. is scheduled for a bank foreclosure auction Sept.17, according to a listing by Tranzon Property Auctions.

Boston East Brunswick Holdings, a subsidiary of Troca Hotels, secured a mortgage through Saco Biddeford Savings Institution and purchased The Daniel in 2013 for $1.45 million, according to property records. 

The property is currently valued at about $2 million, following extensive renovations in 2015. 

Ruth Lind, associate broker with Tranzon, said people have already signed up to view the building. 

Some have expressed interest in converting the hotel for residential use while others would like to invest in the building or run it themselves, she said.

Under the terms of the auction, any buyer will be agreeing to accept the property as it stands. According to the property information package, five of the 24 guest rooms are “out of service,” six rooms in the historic federal house have not been completed (though they are reportedly close) and the elevator, which has been broken for at least a year, is still non-functioning. Not to mention the roughly $80,000 in back taxes still owed to the town, which the buyer will be responsible for. 

Still, Lind said The Daniel is still a “high-value property.” 

Formerly known as The Captain Daniel Stone Inn, the hotel dates back to 1819. 

Lind said the kitchen is beautifully equipped, the sauna looks brand new, the fitness center is state of the art and with a little work, there is the potential for a balcony over the main entrance that could be used as a terrace for meetings or socializing. 

In February, Abhijit “Beej” Das, CEO of Troca Hotels, announced his intent to sell the longtime hotel. The Daniel is listed for $2.9 million with Daigle Commercial Group. 

“As part of a strategic decision by Troca Hotels, The Daniel is on the market,” Das said in a statement at the time. “Troca Hotels, its team members, partners and investors are proud to have been a part of the history of this iconic asset and look forward to passing the torch to a new owner seeking to own and operate an incredibly special part of mid-coast Maine.” 

But the hotel ultimately went into foreclosure.

Das, who was out of the office due to a family emergency, said the foreclosure is in the midst of litigation.

Anthony Bistany, Das’s lawyer, said Tuesday that “during the pandemic, which we’re still in right now, foreclosing on a hotel and forcing it into auction isn’t in anyone’s best interest” but could not comment further “pending legal matters.” 

Just a few weeks before Das announced the intent to sell, the United States Bankruptcy Court, District of Massachusetts dismissed a Boston East Brunswick Holdings Chapter 11 bankruptcy filing for a failure to provide proof of or maintain insurance, according to court records. Chapter 11 is a form of bankruptcy that involves a reorganization of a debtor’s business affairs, debts and assets.

When a person files for bankruptcy relief, including an emergency petition as was the case in January, the court issues an automatic stay that stops lenders from going forward with foreclosure or collecting debts.

Just two weeks later, in February, Das paid off an outstanding 2017 Brunswick tax bill just 10 days before the hotel was scheduled to go into foreclosure. 

Boston East Brunswick Holdings LLC, a subsidiary of Troca Hotels, paid Brunswick $40,517 on Feb. 14.

In December, a notice from the Maine Revenue Service posted on the hotel’s door said it was “closed for business with the general public” and that the “seller’s registration certification of this establishment has been revoked for noncompliance” with the state’s tax statute. The hotel reopened a few days later and Das credited the closed to an “administrative error with accounting” but refused to comment further. 

Last October, The Daniel closed for three weeks for extensive HVAC repairs, cancelling dozens reservations and a wedding with little to no notice.