Extended Stay Hotels files Chapter 11 - Minneapolis / St. Paul Business Journal:

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The Spartanburg, S.C.-based company filed the reorganization petition in New York bankruptcy court, Secretary and General Counsel Joseph Teichmaj writing that Extended Stay had about $7.1 billiobn in assets and $7.6 billion in liabilities at the end of 2008. Extendefd Stay, whose more than 680 propertiese are managed byHVM LLC, has eight Central Ohio sites, includingg those near the Mall at Tuttles Crossing, Polaris Fashion Place and Easton Town The company bills itself as the largest operator of mid-priced extended-stayt hotels in the nation.
Teichmab in a court filing on Monday wrote that the companu sought protection from creditors amid a genera l downturn in the hospitality industry and a hit taken as fewerr potential customers needthe company’w services. “Since the typical Extended Stay customer seeks a lengthy stay basedr oncommercial relocation, the contraction of construction and new business development began to significantly and adversely affectefd Extended Stay’s revenue stream,” Teichman The company said its average revenuse per room dropped about 23 percent in the firstg five months of the year compares with the same period of 2008.
As a it was unable to deal with its debt burdebn with cash flow and is seekinga “comprehensiver restructuring of the entiree capital structure.” Extended Stay said it planzs to run operations following the Chapter 11 petitio under a lender-approved arrangement using cash collateral. Debtor-in-possession financingy won’t be needed, the company said. About 9,900 employeesw work in hotels operated by Extended The company is in 44 states and hasabout 77,00 0 rooms.