Sea Pine Inc., the owner and operator of The Spruce Point Inn, a 120-year-old luxury inn in Boothbay Harbor has filed for reorganization under Chapter 11 of the federal bankruptcy code.
The inn, which employs 100 workers during the summer season, suffered cash shortages in late 2009 because of the global economic recession. Those shortages prevented it from servicing $12.3 million in secured debt, according to records filed with the U.S Bankruptcy Court.
The voluntary petition for debt relief was filed on April 19.
Under Chapter 11, a corporation is permitted to continue to operate the business under supervision of the court allowing it to generate income, protect jobs and pay creditors.
A full service destination resort, the Spruce Point Inn is situated on a private peninsula outside Boothbay Harbor. It has 23 buildings on 55 acres that include 600 feet of ocean frontage.
The main creditor listed in the filings is the Savings Bank of Maine.
The inn is owned by Angelo DiGiulian and Joseph Paolillo, who purchased the inn in 2003 from their respective families.
Joseph Paolillo said the Inn is open for business and has a pair of weddings booked for this weekend.
“It is business as usual,” he said.
Despite the hopeful sign, Paolillo said last season coupled with the unusual 2009 summer season was tough for the resort.
“The country and Maine took a (economic) hit. Then last summer we had 21 days of rain in June and 15 days in July. It was the wettest year on record. We are not immune,” he said.
Beginning in January, Paolillo said he began to see some hopeful signs. “The corporate side has started to call and we are seeking an uptick in weddings,” he said.
What is still lacking is business from leisure travelers. That may not come back until 2011, Paolillo said.
