WALNUT CREEK, CA — A hotelier that owns seven properties in the extended Bay Area including one in Walnut Creek is mulling bankruptcy and has alerted regulators that it may take that path amid the economic devastation of the coronavirus crisis, The Mercury News reports.
Ashford Hospitality Industry, which owns hotels in 27 states, has notified the Security and Exchange Commission that it may need to file for Chapter 11 bankruptcy, the report said.
The Texas-based company, which owns the Embassy Suites Walnut Creek in Walnut Creek told regulators it has enough cash to last through the early part of this year, but not much longer.
“We will need substantial additional funding to continue our operating activities” beyond early 2021, the company said in the SEC filing obtained by the news outlet.
In addition to the Walnut Creek property, the company owns the Courtyard Newark and the Residence Inn Newark (both in Newark), the Marriott Fremont in Fremont, the Embassy Suites Santa Clara in Santa Clara, the Hilton Santa Cruz/Scotts Valley in Santa Cruz and Courtyard Oakland Airport in Oakland.
Ashford Hospitality Trust lost $448.5 million over a 12-month period that concluded Sept. 30 according to the report, citing Yahoo Finance. The company reported $772.2 million in revenue over that period.
Ashford Hospitality Trust’s financial woes follow a national trend with the national lodging industry in crisis amid the pandemic.
According to a survey conducted by the American Hotel & Lodging Association, 71 percent of hoteliers said they wouldn’t survive six months without government aid and 77 percent of hotels said they would be forced to lay off employees.
The AHLA released its survey results in November.
AHLA President and CEO Chip Rogers said the survey reflects an urgent need for Congress to pass additional relief.
“Every hour Congress doesn’t act hotels lose 400 jobs. As devastated industries like ours desperately wait for Congress to come together to pass another round of COVID-19 relief legislation, hotels continue to face record devastation. Without action from Congress, half of U.S. hotels could close with massive layoffs in the next six months,” said Rogers.
“With a significant drop in travel demand and seven in 10 Americans not expected to travel over the holidays, hotels will face a difficult winter. We need Congress to prioritize the industries and employees most affected by the crisis. A relief bill would be a critical lifeline for our industry to help us retain and rehire the people who power our industry, our communities, and our economy.”
Read more in The Mercury News
Written by Gideon Rubin/Patch