Spartanburg, S.C. -- HVM L.L.C., said today that the Chapter 11 filing announced by the Board of Directors of Extended Stay Inc. should have no impact on operations of the popular chain of hotels. HVM, a separately owned company, manages 684 hotels throughout the U.S. and Canada under the following brands: Extended Stay America®, Extended Stay Deluxe,SM Homestead Studio Suites Hotels®, StudioPLUS Deluxe Studios® and Crossland Economy Studios®.
“Extended Stay Inc. has turned an important page in restructuring its debt and recapitalizing its business,” said Gary DeLapp, president and CEO of HVM L.L.C., “but for hotel guests, the story is the same: the same great service, the same convenient locations, same comfortable, value-priced hotel rooms.
“All hotels are open and welcoming guests as usual,” Mr. DeLapp said. “Our aim is to provide guests with a comfortable, convenient and affordable experience whether they stay for a night, a week, a month or longer.” He added that value-oriented business travelers, employees on temporary assignments, consultants, relocation professionals and leisure travelers who rely on the chain will notice no change in the hotels’ service or amenities.
Mr. DeLapp said that there are no plans to either close or sell any of the hotels, and he expects that hotel employees – approximately 15 at each location – and HVM’s corporate staff will continue to be paid and receive benefits as usual. Mr. DeLapp further said HVM intends to meet all of its obligations in the ordinary course of business and pay vendors without interruption.
Extended Stay Inc. has petitioned the Court for immediate use of cash collateral from continuing operations, in lieu of debtor-in-possession (DIP) financing. “Our end of the business – hotel operations and administration – remains strong on an operating basis. Because we generate significant positive cash flow, ESI does not need DIP financing to meet its operating obligations,” Mr. DeLapp said.
Every one of the hotel chain’s rooms features a fully equipped kitchen, expanded work space and wireless Internet access. Convenient onsite guest laundry facilities, pet-friendly accommodations and daily, weekly and monthly housekeeping services are available at each hotel. The average length of stay at Extended Stay Hotels is 18 to 20 nights rather than two or three nights at typical hotel properties. Occupancies and operating profit margins are generally greater due to a lower cost operating model.
“We have the broadest distribution of any extended stay company by far,” Mr. DeLapp said, adding: “We are Number One in our category and intend to remain that way.”