Jun 3, 2020

Travelodge set to launch CVA in effort to end rent stand-off

Travelodge is set to launch last-resort bankruptcy proceedings that will legally allow it to slash rents in an attempt to end a fractious dispute between the hotel chain and its landlords. Unlike standard CVAs, Travelodge will not shut any of its 564 sites or permanently cut rents. The budget hotel operator has been in a tit-for-tat dispute with its landlords since it refused to pay rent for the second quarter at the end of March. The landlords previously offered to write off one quarter's rent and allow Travelodge to reduce its bill by 20 per cent for the rest of the year, adding that if the company did not agree to the terms, they would forfeit the leases as soon as they were legally allowed to and replace Travelodge with a new budget hotel brand. Property owners have been prevented from forcing out tenants that do not pay their rent under the government's coronavirus regulations, which give tenants 90 days' grace before landlords can evict them.

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