Charlotte-based Extended Stay America sold for $6 billion
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Two investment firms are buying Charlotte-based hotel chain Extended Stay America for $6 billion.
On Monday, Blackstone Group Inc. and Starwood Capital Group announced plans to buy the company. Extended Stay specializes in mid-priced hotels where guests stay for weeks at a time.
Why it matters: The sale of Extended Stay is a sign of optimism in the lodging industry during the pandemic, wrote the Wall Street Journal, which was first to report the sale. The Journal in December called Extended Stay a “pandemic sleeper hit” for its ability to outperform its competitors and turn a profit last year.
- Nationwide, the pandemic has pummeled the hospitality industry.
- In Uptown, the uncertainty around the future of business travel has forced hotels to furlough or lay off workers. At least four hotel projects are on hold, too. [Go deeper]
What he’s saying: Extended Stay CEO Bruce Haase called the company’s new owners “two of the most experienced investors in the hospitality space” with impressive track records. “We look forward to this partnership and continued growth,” Haase said in a statement.
It’s unclear what the sale of the company means for its operations at its Ballantyne headquarters. It’s also not yet clear whether the deal will lead to any layoffs in Charlotte.
An Extended Stay spokesperson did not respond to multiple requests for comment.
Zoom out: Extended Stay started in Florida in 1995. It moved its headquarters to Spartanburg before relocating again to Charlotte in 2012.
Over the years, Extended Stay has changed hands several times. Blackstone bought Extended Stay in 2004, taking the company private and adding more than 200 hotels to its portfolio over time. In 2007, The Lightstone Group, LLC, a real estate company, bought Extended Stay from Blackstone for about $8 billion.
Extended Stay filed for bankruptcy in 2008 after grappling with a heavy debt load, the Observer wrote a few years ago. In 2010, a group of private equity firms including Blackstone bought Extended Stay out of bankruptcy. In 2013, the company went public.
Today, Extended Stay has 650 hotels in the U.S.