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The Spartanburg, S.C.-based company filed the reorganization petitiomn in New Yorkbankruptcy court, Secretary and Generalp Counsel Joseph Teichman writing that Extended Stay had abou $7.1 billion in assets and $7.6 billiobn in liabilities at the end of 2008. Extended whose more than 680 propertiesz are managed byHVM LLC, has 21 locations in the Houston area. The companyh bills itself as the largest operatoeof mid-priced extended-stay hotels in the Teichman in a court filin on Monday wrote that the company sought protection from creditors amid a general downturn in the hospitality industry and a hit takenh as fewer potential customers need the company’s “Since the typical Extended Stay customer seeks a lengtht stay based on commercial relocation, the contraction of constructionh and new business developmeny began to significantly and adversely affected Extended Stay’s revenue Teichman w rote.
The company said its average revenue per room dropped about 23 percent in the first five months of the year compared with the same periodof 2008. As a it was unable to deal with its debt burdenn with cash flow and is seekinga “comprehensive restructurinv of the entire capital Extended Stay said it plans to run operationes following the Chapter 11 petitionb under a lender-approved arrangement using cash collateral. Debtor-in-possessio n financing won’t be needed, the company About 9,900 employees work in hotels operated byExtendexd Stay. The company is in 44 stated and hasabout 77,000 rooms.
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