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Jenner & Block recently helped Arlington Hospitality, Inc., creator of the AmeriHost Inn brand name, to complete the $28.1 million sale of its assets to Sunburst Hotel Holdings, Inc. and SJB Equities, Inc., thereby moving Arlington one step closer to ending its Chapter 11 proceedings.
The total consideration for the sale of assets included $9.5 million in cash and the assumption of approximately $18.6 million in mortgage debt on the purchased hotel assets.
Sunburst assumed nearly all of the hotel development and management company’s assets with the exception of two wholly-owned hotels, its corporate headquarters office building, and four hotel joint ventures purchased by SJB. Arlington is also in the process of relinquishing possession of twelve remaining hotel leases with its mortgage lender.
Arlington hopes to propose a liquidation plan to the U.S. Bankruptcy Court for the Northern District of Illinois as soon as practicable, according to a press release. In August 2005, the company had filed voluntary Chapter 11 restructuring bankruptcy petitions in that court as a result of challenging conditions in the lodging industry, including decreased cash flow and increased operating costs.
Sunburst Hospitality, based in Silver Spring, Maryland, is a diversified real estate owner and operator, with interests in hotels, golf course and residential developments. Including the former Arlington assets, the company’s hotel portfolio now includes more than 40 hotels nationwide.
Partner Catherine L. Steege and Associates Brian H. Meldrum and Jayne Laiprasert serve as debtor counsel for Arlington Hospitality, Inc. Partners Edward J. Neveril and Ronald I. Reicin and Associate Calso assisted in the sale.