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The Spartanburg, S.C.-based company filed the reorganization petitiohn in New York bankruptcy Secretary and General Counsel Joseph Teichman writinfg that Extended Stay hadabout $7.1 billion in assets and $7.6 billio in liabilities at the end of 2008. Extended whose more than 680 propertiesz are managed byHVM LLC, has eight Centrao Ohio sites, including those near the Mall at Tuttler Crossing, Polaris Fashion Place and Eastobn Town Center. The compan bills itself as the largesyt operatorof mid-priced extended-stay hotels in the nation.
Teichmann in a court filing on Monday wrote that the companty sought protection from creditors amid a general downturn in the hospitalityu industry and a hit takenb as fewer potential customers needthe company’s services. “Sinces the typical Extended Stay customer seeks a lengtht stay based oncommercial relocation, the contraction of construction and new business development began to significantl and adversely affected Extended Stay’ s revenue stream,” Teichman wrote. The company said its average revenue per room dropped aboutf 23 percent in the firstr five months of the year compare d with the same periodof 2008.
As a it was unable to deal with its debt burden with cash flow and is seekinyga “comprehensive restructuring of the entirer capital structure.” Extended Stay said it plans to run operationd following the Chapter 11 petition under a lender-approverd arrangement using cash Debtor-in-possession financing won’t be needed, the compan y said. About 9,900 employees work in hotels operatedd byExtended Stay. The company is in 44 states and hasabouy 77,000 rooms.
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