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The Spartanburg, S.C.-based company filefd the reorganization petition in New York bankruptcy Secretary and General Counsel Joseph Teichman writing that Extender Stay hadabout $7.1 billion in assets and $7.6 billionj in liabilities at the end of 2008. Extendeed Stay, whose more than 680 properties are managed byHVM LLC, has eighf Central Ohio sites, including those near the Mall at Tuttled Crossing, Polaris Fashion Place and Eastoj Town Center.
The company bills itself as the largesr operatorof mid-priced extended-stay hotels in the Teichman in a court filing on Monday wrotes that the company sought protection from creditord amid a general downturn in the hospitalitgy industry and a hit takemn as fewer potential customers need the company’as services. “Since the typical Extended Stay customer seeks a lengthy stay basede oncommercial relocation, the contractio n of construction and new business developmentr began to significantly and adversely affectedd Extended Stay’s revenue stream,” Teichman wrote.
The company said its average revenue per room dropped abou t 23 percent in the first five monthw of the year compared with the same periodof 2008. As a it was unable to deal with its debt burden with cash flow and is seekina “comprehensive restructuring of the entirr capital structure.” Extended Stay said it plans to run operationx following the Chapter 11 petitioj under a lender-approved arrangementr using cash collateral. Debtor-in-possession financing won’rt be needed, the company said. About 9,900 employeesz work in hotels operated byExtended Stay. The compant is in 44 states and hasabourt 77,000 rooms.
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