A HOTEL investment company, Innkeepers USA Trust, has filed for bankruptcy protection after its room revenue fell and debt payments rose.
Bloomberg News said the Palm Beach, Florida-based company with stakes in 72 U.S. hotels owes more than $1 billion, Chapter 11 documents filed last month in U.S. Bankruptcy Court in Manhattan indicated.
A plan supported by franchiser Marriott International Inc. will let Innkeepers keep its properties as it reorganizes, Innkeeper’s chief financial officer Dennis Craven said in reports.
Slowdown
Craven attributed the financial difficulties of the company to the slowdown in travel amid the economic slowdown, compounded by higher fuel prices and an oversupply of new hotels.
Marriott is the franchiser of 44 Innkeepers hotels. In exchange for Innkeepers’ improving 23 of the Marriott-branded hotels, Marriott will maintain the branding.
Sought for comment, Cebu City Marriott Hotel general manager Bruce Winton said the incident will in no way affect the Cebu City Marriott Hotel.
“Majority of Marriott branded hotels are operated under long-term management agreements or franchise agreements with third-party management companies and separate ownership groups.
The Cebu City Marriott is owned by Ayala Hotels and Cebu Holdings and operates by Marriott International under a long-term management agreement and, therefore, has nothing to do with Apollo Investment’s Innkeepers USA Trust,” Winton said in a statement sent to Sun.Star Cebu.
Innkeepers USA Trust is owned by an affiliate of Apollo Investment Corp.