Content area
Full Text
SPARTANBURG, S.C.-The extended-stay segment's new 300-pound gorilla is busy settling into its position as the sectors largest supplier.
Extended Stay hotels, a company formed after The Blackstone Group acquired the assets of Extended Stay America, has no plans to divest any of its brands or enter the franchising arena, according to Gary DeLapp, president and c.e.o.
ESH will manage the 599 hotels with 66,300 guest units open-about 27.6 percent of all of the 240,100 extended-stay rooms open in the United States. Its brands are Homestead Studio Suites hotels, Extended Stay-America Efficiency Studios, StudioPLUS Deluxe Studios and Grassland Economy Studios. The latter three were part of the $3.3-billion ESA deal. Homestead was acquired by Blackstone in November 2001 from Security Capital for $740 million.
"One of the driving factors in the transaction was that we anticipated some of the advantages of scale," said Jonathan Gray, senior managing director for Blackstone. "We would not have been able to do the deal had we not already owned Homestead."
"It's been very satisfying," DeLapp said. "There's a euphoria about the whole thing."
"It's been an extremely smooth transition," Gray said. "A lot of credit goes to the Extended Stay management team led by George Johnson and Corry Oakes. They were complete gentlemen and during the 60 days between when the deal was announced and when it was final, they allowed us to get intimately involved in the business. That was extremely helpful."
DeLapp said the timing is perfect for...