SILVER SPRING, MD-Sunburst Hospitality Corp., essentially the former real estate arm of Choice Hotels International, on Wednesday agreed to sell itself to a group of managers and shareholders led by the company’s chairman, Steward Bainum Jr.

The group will buy the owner and manager of hotels for $7.375 a share, or $116.5 million. Bainum and his family already hold 46% of Sunburst. The buyout group also includes James A. MacCutcheon, Sunburst’s chief financial officer, other Sunburst managers and members of the Bainum family.

Sunburst’s chief executive, Donald Landry, said he will step down once the sale is completed. MacCutcheon becomes co-chief executive and will become president and chief executive after Landry’s resignation.

Sunburst is the largest franchisee of Choice Hotels International Inc., which runs the Comfort Inn, Clarion Hotels, MainsStay Suites, Sleep Inn and Quality Inn hotel brands. In 1997, Choice spun off Sunburst to operate its branded hotels. Choice is also 39% owned by Bainum, who is chairman of the company.

Choice agreed to restructure the $136 million in debt that Sunburst owes Choice. Choice will receive $76 million plus interest in cash upon completion of the acquisition. Then it will receive a newly issued seven-year senior subordinated note worth $60 million.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join now!

  • Free unlimited access to's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including and

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.