The city-owned hotel in New Jersey's state capital has filed for bankruptcy protection, saying it owes $25 million and needs “breathing room” from creditors.
Lafayette Yard Hotel & Conference Center is also Trenton's only hotel. It opened in 2001 and was promoted as a potential boon for a struggling city.
The Times of Trenton reports the hotel's owner said in court filings this week that it owes money to 181 creditors.
“Due to the current economic conditions, the hotel’s significant long term debt of approximately $29.9 million and a sharp decline in operating revenues forecasted to end the year, the (Lafayette board) has determined that Chapter 11 filing is the only way to protect the interests of the hotel and to insure that an orderly and maximum sale is possible,” according to a court document obtained by the Times.
A bankruptcy plan is to be in place by the end of January.
Mayor Tony Mack asked the board that oversees the 197-bed hotel to sell it, and the board is planning an auction.
The hotel has more than $13 million in city-backed debt.