March 10, 1998—Extended Stay America, Inc. (NYSE:ESA), today announced that it has increased availability under its bank credit facility by $200 million and has restructured the facility to provide a total of $350 million in term loans and an additional $350 million in revolving loans. The increase in the bank facility, combined with the previously announced completion of a private placement of $200 million of Senior Subordinated Notes, provides the Company with $400 million of additional capital to continue its development of extended stay lodging facilities. The Company now has a total of $900 million available under its debt facilities, of which $300 million has been drawn.
George D. Johnson, Jr., President and CEO, commented: “The debt facilities, when combined with our book equity, provide us with a total of over $1.7 billion in capital for the development of extended stay lodging facilities. With a total of 281 properties open or under construction at the end of February, we are well on our way to our plan to have over 300 properties open by the end of 1998. We are pleased that we have been able to structure our debt facilities in a manner that will provide us with flexible access to the capital needed to continue our development into 1999.”
Extended Stay America`s three extended stay lodging brands often operate concurrently in the same market. All properties are designed to appeal to value-conscious guests on visits of a week or longer. Crossland Economy Studios, with rates generally ranging from $159 to $199 per week, offer a double bed and kitchenette. EXTENDED STAYAMERICA Efficiency Studios, with rates generally ranging from $199 to $299 a week, offer a queen-size bed and kitchenette. StudioPLUS Deluxe Studios offer deluxe and queen studios, which include kitchens, at rates generally ranging from $299 to $399 a week. Weekly housekeeping and an on-premises laundry are provided at all properties.
The Company`s first EXTENDED STAYAMERICA Efficiency Studios property opened in August 1995, in Spartanburg, SC. In January 1997, the Company launched the first Crossland Economy Studios in Independence, MO, and on April 11, 1997, the Company consummated a merger with Studio Plus Hotels, Inc. As of February 28, 1998, the Company owned and operated 213 extended stay lodging properties in 37 states, had 68 properties under construction and had options to acquire 154 additional sites.
With the exception of historical information, the matters discussed in this news release include “forward-looking statements” within the meaning of the Federal Securities Laws and are qualified by cautionary statements contained herein and in the Company`s filings with the Securities and Exchange Commission.