The U.S. Bankruptcy Court in New York has approved the reorganization plan of Innkeepers USA Trust, a REIT that filed for Chapter 11 protection in July 2010.

Under the plan, a joint venture between Cerberus Capital Management LP and Chatham Lodging will purchase the equity in entities that own and operate 65 of Innkeepers hotels for $1.1 billion.

Chatham will also buy five hotels that serve as collateral for loan trusts serviced by LNR Partners for $195 million.

The majority of the company's unsecured creditors, as well as the holders of its preferred "C" shares are expected "to make a meaningful recovery," Innkeepers said in a press release.

A hearing has been scheduled in the bankruptcy court for July 21. Innkeepers said 90% of the unsecured creditors and shareholders have approved the plan.

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