Extended Stay America

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International Guild of Hospitality & Restaurant Managers

Extended Stay America (ESA)

Extended Stay America, Inc. (ESA), organized in 1995, develops, owns and operates extended-stay lodging facilities, which provide an affordable lodging alternative at a variety of price points for value-conscious guests. The Company's facilities are designed to offer a superior product at lower rates than most other lodging providers within their respective price segments. ESA's facilities feature fully furnished rooms that are generally rented on a weekly basis to guests such as business travelers, professionals on temporary work assignment, persons between domestic situations and persons relocating or purchasing a home.

The Company owns and operates three brands in the extended-stay lodging market: StudioPLUS Deluxe Studios, Extended Stay America Efficiency Studios and Crossland Economy Studios. Each brand is designed to appeal to different price points generally below $500 per week. All three brands offer the same core components: a living/sleeping area, a fully equipped kitchen or kitchenette and a bathroom. Extended Stay rooms are designed to compete in the economy category. Crossland rooms are typically smaller than Extended Stay rooms and are targeted for the budget category, and StudioPLUS facilities serve the mid-price category and generally feature larger guest rooms, an exercise room and a swimming pool.

As of December 31, 2001 , ESA owned and operated 431 extended-stay lodging facilities, of which 39 were Crossland, 298 were Extended Stay and 94 were StudioPLUS facilities, and had 20 facilities under construction in a total of 42 states. The Company had approximately 46,000 rooms, or about 36% of the lower tier segment, at the end of 2001. ESA plans to commence construction on 15 additional sites with total costs of approximately $150 million during 2002, the majority of which are expected to open in 2003. The Company may increase the number of sites upon which it commences construction in 2002, however, depending upon a number of factors, including improvements in the overall United States economy, improvements in demand for lodging products in the overall lodging industry and improvements in demand for ESA's extended-stay lodging products. The Company plans to continue an active development program in 2003 and thereafter. ESA also may make opportunistic acquisitions of other lodging companies or facilities.

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