Choice Hotels International announced Monday it has agreed to acquire the WoodSpring Suites brand and franchise business from WoodSpring Hotels Holdings LLC.
In a move that will bolster the hotel giant's presence in the quickly expanding extended-stay segment, the $231 million acquisition will add nearly 240 hotels across 35 U.S. states to the Choice Hotels portfolio, growing its footprint to more than 350 properties.
The company already owns the MainStay Suites and Suburban Extended Stay brands for guests seeking longer stays in apartment-like rooms boasting kitchens and other convenient amenities.
WoodSpring Suites has emerged as a strong brand in recent years following a successful brand relaunch in 2015. Over the last three years, the chain has reported unit growth of more than 25 percent while its franchise fee revenue has climbed by 45 percent.
More than two dozen WoodSpring hotels are expected to open in 2018.
"Like Choice Hotels, WoodSpring Suites has demonstrated exceptional customer service, attractive franchisee return on investment, and tremendous growth," said Choice Hotels president and CEO, Patrick Pacious in a statement. "Extended-stay is a fast-growing segment, reporting some of the strongest gains in demand and has led the hospitality industry in annual RevPAR growth."
"The addition of the WoodSpring Suites brand will allow us to strengthen our scale within the attractive extended-stay segment, expand our runway for growth, and continue to create value for our customers, franchisees and shareholders."
The transaction, which remains subject to customary adjustments, is expected to be completed during the first quarter of 2018. WoodSpring Hotels Holdings LLC will be renamed and maintain its hotel management operations.
Choice Hotels' pursuit of extended-stay dominance comes two months after the Rockville, Maryland-based company rolled out a new campaign for its Sleep Inn midscale brand aimed at the lucrative market.
Last month, Choice Hotels signed a multi-year deal with the Avis Budget Group, making it one of the company's preferred car rental partners.
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