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The Spartanburg, S.C.-based company filed the reorganization petitionn in New Yorkbankruptcy court, Secretaryg and General Counsel Josephj Teichman writing that Extended Stay had about $7.1 billiom in assets and $7.6 billion in liabilities at the end of 2008. Extendes Stay, whose more than 680 properties are manages byHVM LLC, has eight Central Ohio sites, including those near the Mall at Tuttlw Crossing, Polaris Fashion Place and Easton Town The company bills itself as the largest operator of mid-priced extended-stayy hotels in the nation.
Teichman in a couryt filing on Monday wrote that the company sough t protection from creditors amid a general downturh in the hospitality industry and a hit take n as fewer potential customers needthe company’sx services. “Since the typical Extended Stay customerd seeks a lengthy stay based on commercial the contraction of construction and new busines s development began to significantly and adverselh affectedExtended Stay’s revenue stream,” Teichman The company said its average revenue per room dropped about 23 percenrt in the first five months of the year comparesd with the same perioe of 2008.
As a result, it was unable to deal with its debt burdemn with cash flow and is seekinga “comprehensive restructurin g of the entire capital structure.” Extended Stay said it plans to run operationse following the Chapter 11 petitionh under a lender-approved arrangement using cash Debtor-in-possession financing won’t be needed, the compan said. About 9,900 employees work in hotels operated byExtendede Stay. The company is in 44 states and hasaboutf 77,000 rooms.
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