Lightstone Closes $8B Extended Stay Deal

For that $8 billion, the Lightstone affiliate is getting the largest owner of mid-price extended-stay hotels in the US, with 687 hotels and approximately 76,000 rooms in 44 states and Canada. The company currently operates under five brands in the extended-stay segment: Extended Stay Deluxe, Extended Stay America, Homestead Studio Suites, StudioPlus and Crossland.

"The acquisition marks our entry into another sector, and we are excited about the opportunity to deliver value to our partners in this venture," says David Lichtenstein, chairman/CEO Lightstone. "And Blackstone's continued investment in Extended Stay substantiates the transaction value and signifies their confidence in our business strategy."

In the deal, Lightstone's team was directed by Michael M. Schurer, CFO; Joshua Kornberg, director of acquisitions; and Joseph E. Teichman, general counsel. Lead mortgage and mezz financing was provided by Robert Verrone and Peter Scola of Wachovia Bank and Randy Rieff of Bear Stearns. Anthony Fineman of Wachovia was the deal manager. Merrill Lynch Mortgage Lending and Bank of America also provided financing.

Citi, led by Paul Ingrassia, was financial advisor to Lightstone. Herrick, Feinstein's Sheldon Chanales and Proskauer Rose's Peter Fass were legal advisors to Lightstone. Dechert LLP was legal advisor for Arbor. Bear Stearns, Blackstone Corporate Advisory, Banc of America Securities and Merrill Lynch were financial advisors to Blackstone. Simpson Thacher & Bartlett was legal advisor to Extended Stay Hotels and Blackstone.