InTown Suites Posts Strong Q3

Weekly revenue per available room of $150.17 and $151.28 for the third quarter and nine-month period respectively was up from $149.84 and $148.97 in the 2001 periods.

The former Suburban Lodges, acquired by InTown in the second quarter, increased RevPAR over the second quarter to $135.60, a 3% improvement.

But the company's occupancy numbers show conclusively holiday and business travelers are opting for lower-priced hotel stays. Third-quarter occupancy for the company's 53 original hotels rose to 90.5% versus 86.9% in the same 2001 period.

Occupancy for InTown's 65 hotels obtained in the Suburban Lodges acquisition and converted to the InTown brand was 73.3%. Company-wide occupancy was 80.8%.

"The third quarter was a difficult operating period for the entire industry," InTown president David Vickers says in a prepared statement. "Our segment, where price/value is critical, continues to demonstrate strong demand."

Vickers says Intown is spending more than $20 million to upgrade and convert the former Suburban Lodges to the Intown Suites brand. "The conversion process is taking a lot of rooms out of inventory, which makes the improvement in RevPAR all the more encouraging," he says.

The Intown chief says the renovation/conversion investment already is beginning to pay off. "We've posted RevPAR gains for our original hotels every quarter this year, and are up 1.6% for the nine months," Vickers says. Third quarter net operating income per room for the former Suburban Lodges improved 43%, compared to the 2002 second quarter.

InTown plans to break ground on three projects in first quarter 2003--two hotels in Denver and one in South Florida.

"As part of our on-going growth strategy, we seek development opportunities in strategic markets that have high barriers to new competition," Vickers says. The company also scouts for other brands or large portfolios of hotels that can be converted to the Intown brand.

"Demand for our product and brand continues to increase, despite the sluggish economy, and we are aggressively seeking ways to take advantage of current conditions," he says.

Intown claims to be the largest economy-segment, extended-stay brand in the United States. A typical property has 121 studio suites (300 sf) located on main thoroughfares in major urban and suburban markets. The company operates 15,400 rooms in 21 states.