A well-known castle hotel and restaurant goes bankrupt for millions

It should have been a success story. Instead, the dream of an exclusive business resort in one of the most historic buildings in Upper Austria ends in bankruptcy. It was loud on Wednesday Credit reform about the assets of Schloss Mühldorf HOTEL GmbH & Co KG on Linz Regional Court Bankruptcy proceedings are opened – the temporary end of a hotel that breathes more than a thousand years of history.

From the moated castle to the 4-star hotel

The history of the property dates back to the year 1,000. What once began as a moated castle became a stately castle over the centuries. The Würmer family has operated a hotel and conference center with restaurants on the historic site for more than twenty years. The castle itself remained in the private ownership of Mag. Johannes Würmer, while the operating company was the owner of the so-called “Meierhof” – the outbuildings that are part of the ensemble.

When Johannes Würmer took over his parents’ business in 1999, he had big plans. With continuous investment, the house was completely rebuilt, expanded and upgraded to a 4-star standard. The romantic castle complex with 35 individually furnished rooms, a 27-hole golf course and the most modern comforts should attract guests from all over the world.

The creeping crisis

But even in the years before the pandemic, it became apparent that the plan wasn’t working. Losses piled up and the hoped-for increases in the value of the properties could no longer compensate for the red numbers. Then came Corona – and with the pandemic a “special challenge,” as the insolvency application euphemistically puts it.

In 2023, Worms dared to start again. The concept “Business Class Resort Schloss Mühldorf” was intended to bring about a turning point: aimed at international corporate customers, business stays, temporary living and long-term corporate cooperation. Investments were made again, apartments were built, and the vision of a modern business resort in a historic ambience took shape.

When the world doesn’t cooperate

But the world didn’t play along. Inflation galloped, business trips were drastically reduced, companies went bankrupt in large numbers or implemented austerity programs. The hoped-for clientele failed to materialize. “Due to the continued negative global and national economic development,” the negative trend could not be stopped, the application states soberly.

The financing bank lost trust and called in the loans – a death knell for the ailing company. The numbers speak for themselves: the total liabilities of 6.66 million euros compare to a market value of the properties of 16.1 million euros. But 7.45 million euros of this is already encumbered by liens – and the property is not only liable for the operating company’s debts, but also for Würmer’s personal liabilities.

The desperate fight for survival

Worms fought until the end. With “full and transparent involvement” of the main creditor, he looked for ways to avert insolvency. Projects for long-term financing were started and structured sales processes initiated. Negotiations were held with “several serious and well-known interested parties”. But an agreement was not reached.

“The carrying capacity has now been reached,” it says in the insolvency application. Operations have already ceased and the desire to continue has expired. Due to a lack of positive perspectives, Würmer no longer sees a way forward.

No future

At least: Employees don’t have to worry about their jobs – the company no longer employs employees and there are no outstanding claims. A small consolation given the end of a company history that has lasted more than twenty years.

The assets should now be liquidated. In addition to the real estate, this also includes “various assets of unknown value from antiques and office furnishings” – silent witnesses to a time when guests were still welcomed within the historic walls.

What will become of Mühldorf Castle is uncertain. The thousand-year history of the property will continue – just without a hotel. For Johannes Würmer and his family, this ends a chapter that began with so much hope and now ends in bankruptcy.