The recession-prompted cutbacks in business travel spending have claimed a victim in Extended Stay Hotels, which today filed for Chapter 11 bankruptcy protection in New York.
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Bloomberg.com reports that, in court documents, Joseph Teichman, Extended Stay’s secretary and general counsel, blamed a decrease in business travel for the chasm between the company's $7.1 billion in assets and $7.6 billion in debts at the end of last year. The company's 680 properties, which include Extended Stay Deluxe, Extended Stay America Efficiency Studios, Homestead Studio Suites, StudioPLUS Deluxe Studios and Crossland Economy Studios, are aimed at business travelers professionals looking for a permanent home after relocating, Teichman said.
Under Chapter 11, most businesses develop a plan to reorganize and stay afloat under government watch.