"City Hotels has managed its own hotels for more than 25 years,first in Europe and for nearly the past decade, in the US," saysJerry Herman, City Hotel USA's managing director. "We now have theexpertise and infrastructure in place, and proven asset valuecreation, to expand into third-party management."

The company signed its first long-term contract to operate theHomewood Suites Hotel, in Falls Church, VA and plans to add up to20 management contracts within the next several years. Ultimately,the company plans to manage about 25 properties in the US.Expansion will begin ysin Europe. Herman says the firm recentlycompleted a major equity transaction with a subsidiary of theAlmanij Group, a large European institutional investor.

"Initially we will primarily focus on Europe because marketconditions currently are more favorable there," he says. "We havethe ability and flexibility to move quickly on either continent,and believe US acquisition opportunities will increase over thenext year."