A group of companies that together own eight Texas hotels on Wednesday sought chapter 11 protection after failing to reach a deal to refinance their debt, the Wall Street Journal reported today. The companies’ hotels are located in the Texas cities of Andrews, Midland, Cuero, Pearsall, Pecos and Port Arthur, with another hotel in Hobbs, N.M. — all areas the companies say have “high concentrations” of oil and gas activity. As a result, much of the hotels’ business is “closely tied” to the industry, which employs many out-of-town workers who need lodging. In court papers, the companies say they’re hoping to continue to operate the hotels, which they say are cash-flow positive. To that end, they’ve asked a Texas bankruptcy court for the right to tap their lender’s cash collateral. The first hearing in the case is set for today.
