Schrager seeks bankruptcy protection for Clift hotel
Ian Schrager, owner of London's Sanderson and St Martin's Lane hotels, has filed under US law for Chapter 11 bankruptcy protection for his five-star Clift hotel in San Francisco, California.
The 374-bedroom hotel, which is burdened with $57m (£36.1m) of debts, has suffered from declining sales since the terrorist attacks of 11 September 2001.
Under Chapter 11, a majority of the hotel's bondholders need to agree to a plan to refinance the property.
A spokesman said: "We had not been able to reach agreement with all the bondholders in time to get the refinancing we had planned in place in time."
He added: "You have to get the approval of 100% of bondholders when negotiating outside of court. In a court-supervised situation, you only need approval from two-thirds of the debt holders by amount of debt, or a majority by number of debt holders."
He expected the refinancing to be completed within 90 to 120 days. The hotel will remain open.
The spokesman added that Schrager's company, Ian Schrager Hotels, had also reached an agreement to refinance $355m (£225m) of debt owed by four more of its 10 properties - the Morgans and Royalton hotels in New York, the Mondrian in Los Angeles and the Delano in Miami.
