The deal also allows for the possibility of an additional $5-million payment over a three-year period. The arrangement brings Choice Hotels' system of brands up to 10 and adds 67 Suburban Extended Stay Hotel chains to Choice's holdings.
"This acquisition allows Choice Hotels to enter a new segment, building on the excellent reputation and performance of the Suburban brand and the expertise we have gained through our mid-scale extended stay MainStay Suites brand," Choice Hotels president and CEO Charles A. Ledsinger Jr says in a prepared statement. "The economy extended-stay segment has strong supply-side potential and a solid track record for providing above-average returns for hoteliers. As we combine Suburban's strong product and brand name with our highly effective global marketing and reservations system, as well as our focused extended stay services and technology infrastructure, we provide both existing Suburban owners and new developers an opportunity for a very compelling return on investment." In January Choice Hotels introduced a new brand, Cambria Suites, a "lower-upscale" chain targeting the business traveler.
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