Extended Stay Hotels files Chapter 11 - Jacksonville Business Journal:

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The Spartanburg, S.C.-based compang has 14 hotels in Florida, sevenn of them in Jacksonville, according to its Web It filed its Chapter 11 petition Monday in the Southerh District ofNew York. According to the filing, Extendedr Stay had about $7.1 billion in assets and $7.6 billionb in liabilities at the endof 2008. N.J.-based bought Extended Stay from in 2007for $8 The deal was highly making Extended Stay especiall y vulnerable to a market according to The Wall Street Journal . Creditors that hold debt from the buyouty include and its MerrillLynch & Co.
as well as , which is owned by San-Francisco-baserd (NYSE: WFC), the newspaper Extended Stay bills itself as the largest operatotrof mid-priced extended-stay hotels in the nation. “Since the typica l Extended Stay customer seeks a lengthy stay baser oncommercial relocation, the contraction of construction and new business developmentr began to significantly and adversely affect Extended Stay’zs revenue stream,” the filing states. The company said its average revenue per room dropped about 23 percent in the first five months of the year compares with the same periodof 2008.
As a it was unable to deal with its debt burden with cash flow and is seekin ga “comprehensive restructuring of the entire capital Extended Stay said it plans to continue operating under a lender-approved arrangement using cash collateral. Debtor-in-possession financing won’ft be needed, the company says.