April 25--The owner of the former Hilton Hotel on the campus of the University of Toledo Medical Center can continue living at the hotel while bank foreclosure action against her proceeds in court, a lawyer for the owner said.

Grace Chojnowski-Kellogg, the owner of the 210-room hotel in South Toledo, and her husband have obtained approval from the court-appointed receiver to stay in a room in the building, said her attorney, Marvin Robon.

The agreement was reached with TOOH Associates LLC, the court-appointed receiver, after Mr. Robon requested a hearing in Lucas County Common Pleas Court to stop the receiver from evicting his client. Mr. Robon said the hotel at 3100 Glendale Ave. has been home for Mrs. Chojnowski-Kellogg and her husband, Greg Kellogg, for the last 18 months.

The couple also have a home in San Antonio.

"We will be filing an amended order with the court. She will only be removed if the hotel has full occupancy," he said.

The hotel, which was built on land that belongs to the UT Medical Center, formerly known as the Medical College of Ohio, lost its affiliation with the Hilton chain on Jan. 1, and, shortly afterward, was renamed the Hotel at UTMC.

On March 27, lender U.S. Bank National Association initiated foreclosure proceedings and sued Mrs. Chojnowski-Kellogg's company, Amazing Grace Hotels LLC, after it stopped making monthly payments in February on a $9.3 million loan.

An order issued March 29 by Judge Gary Cook removed Mrs. Chojnowski-Kellogg from any involvement in hotel operations and installed TOOH Associates as the receiver to manage the facility.

According to a memorandum filed with the lawsuit, the bank called for the need to protect UT's interests in the property in asking Judge Cook to appoint the receiver in the foreclosure action.

The university terminated the lease with Amazing Grace in March because it was no longer complying with terms of the lease agreement, including paying rent and maintaining a franchise affiliation.

The lawsuit included a March 13 letter from Dr. Lloyd Jacobs, UT president, to the bank and Mrs. Chojnowski-Kellogg, informing them that the college was canceling the lease because more than $84,000 was owed in rent obligations and room usage.

Mr. Robon said the agreement he reached with the receiver's attorney will allow his client to show the property to potential buyers.

He said Mrs. Chojnowski-Kellogg had recently submitted an application with $25,000 to bring a new franchise flag to the building, but the receiver wouldn't allow workers on the property to measure for sign placement.

"Grace is a Polish lady and an immigrant who doesn't read English. But she has been extremely successful. She has bought and sold hotels to move up to bigger properties," Mr. Robon said.

Doug Vought, vice president of hotel operations for TOOH Associates, confirmed the lodging arrangement for the Kelloggs. "We are not planning on evicting her," he said.

Mr. Vought said the receiver has resumed paying rent and other fees to the university and is looking to affiliate with a national hotel chain.

"I want to make it clear that the hotel is operating and we will continue to operate," he said. "We are delivering the same high-quality facilities and services that have always been here."

Contact Mark Reiter at: [email protected] or 419-724-6199.

___

(c)2013 The Blade (Toledo, Ohio)

Visit The Blade (Toledo, Ohio) at www.toledoblade.com

Distributed by MCT Information Services NYSE:K,