Las Vegas timeshare operator files for Chapter 11

By Steve Green

Tuesday, March 3, 2009 | 10:11 a.m.

ILX Resorts Inc., a timeshare operator with inventory at the Carriage House Hotel in Las Vegas, filed for Chapter 11 bankruptcy protection Monday after talks collapsed with a key lender over extending a loan.

ILX, which has been hurt hard by the recession like other tourism companies, is based in Phoenix and filed for bankruptcy protection there. The company, which has publicly traded stock, calls itself a developer, operator and marketer of upscale flexible-stay vacation ownership resorts in the western United States.

For the third quarter of 2008, ILX said it had negative revenue of $4.2 million because of $14.8 million in uncollectible revenue it recognized. This caused a loss for the quarter of $7.3 million compared to a loss in the 2007 quarter of $290,000 on revenue of $12 million.

ILX, known for its Los Abrigados Resort in Sedona, Ariz., said in a regulatory filing that a loan and security agreement from Textron Financial Corp. for $4.6 million was terminated Sunday after it and Textron couldn't agree on terms to extend the loan. The note is secured by 14 acres of land in Sedona, ILX said.

In Las Vegas, ILX lists the 125-room Carriage House at 105 E. Harmon Ave. near the Las Vegas Strip as one of the resorts where it controls some timeshare inventory -- 2,233 vacation ownership interests as of last fall.

"Dramatic challenges in the economy and recent unanticipated reductions in our credit facilities caused by disruption and instability in the capital markets have necessitated that we seek reorganization protection to preserve resources for an orderly restructuring of the Company," ILX Chief Executive Joe Martori said in a statement.

The company said it expects that Chapter 11 protection will enable the company to conduct its business operations as usual.

Steve Green can be reached at 990-7714 or [email protected].