"Hilton" currently is gone from the top of the Downtown hotel that carried its name for 51 years, but maybe not for good.

Based on testimony in U.S. Bankruptcy Court Friday, Hilton could return as the franchise for the city's largest hotel if New York-based lender BlackRock Financial Management Inc. wins its bid to foreclose against the owner of the property.

Eloisa Mascarenas, a BlackRock vice president, testified that Hilton had agreed to enter into a long-term franchise license deal with the lender if it ends up owning the hotel through a foreclosure.

The chain also is prepared to do so on an interim basis if a receiver is appointed to run the property until the foreclosure takes place.

BlackRock is seeking approval from U.S. Bankruptcy Judge Jeffery Deller to move forward with a foreclosure that was triggered when Hilton terminated its franchise license agreement with Shubh Hotels Pittsburgh LLC, which has been the hotel owner.

The termination is considered a default under BlackRock's $49.6 million mortgage with Shubh. The foreclosure was suspended when Shubh filed for Chapter 11 bankruptcy protection.

Ms. Mascarenas, who once worked for Hilton, said BlackRock had already been approved by the chain as a franchisee.

A Hilton spokesman could not be reached for comment.

Under questioning by John Steiner, an attorney for the committee of unsecured creditors in the bankruptcy, Ms. Mascarenas said BlackRock intended to own and operate the hotel if there is a foreclosure.

Ms. Mascarenas also stated that the lender might put forth its own plan of reorganization in the bankruptcy. Asked if the plan would include payments to vendors and other contractors owed millions of dollars by Shubh, she replied, "We would consider that."

However, she acknowledged that in a foreclosure, such creditors could end up receiving nothing.

Based on Ms. Mascarenas' testimony, BlackRock also considered foreclosing against the property in 2009 because of defaults under the loan agreement.

She conceded that a memo prepared at the time indicated that $6.7 million in liens against Shubh for various nonpayments would be "extinguished" through the foreclosure.

But she added, "That doesn't mean that's our strategy this time around, given the situation."

BlackRock's intent contrasts with a plan of reorganization prepared by Dr. Kiran Patel, a Tampa, Fla., cardiologist who is seeking to rescue the hotel from bankruptcy and rebrand it as a Wyndham Grand under Wyndham Hotels & Resorts.

The plan would fully repay all creditors with allowable claims over a period of several years. The payments would be made out of hotel revenues, backed by $8 million in letters of credit procured by Dr. Patel.

Scott Hare, an attorney for Shubh, argued that BlackRock's objective in the case was to foreclose on the property for its benefit and to the detriment of others. He said that if the stay on foreclosure were lifted, it could "imperil" contractors, vendors and other unsecured creditors who are owed money.

In questioning, Ms. Mascarenas said BlackRock had valued the former Hilton at about $56 million, more than the $49.6 million mortgage on the property.

Asked if that would provide a fairly decent return for BlackRock if it sold the property for that amount, Ms. Mascarenas stated it would, but added that she believed that the value had been "significantly impaired" by the loss of the Hilton franchise and the bankruptcy.

She acknowledged that Shubh was current on its interest-only loan payments, and had never defaulted on those. Principal payments do not start until at least 2015. Interest on the mortgage is 1.67 percent, which she described as "very favorable" to the borrower.

BlackRock demanded immediate repayment of the full $49.6 million loan when Hilton terminated its franchise license agreement with Shubh, triggering the default.

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