Hotel owner and operator Extended Stay America Inc is getting new joint owners.
Blackstone Group Inc. and Starwood Capital Group have agreed to acquire the company in a 50/50 joint venture.
Blackstone and Starwood will pay about $6 billion in an all-cash transaction.
It will become the third time Blackstone has owned Extended Stay America.
"Travel and leisure is one of Blackstone’s highest conviction investment themes, and we have confidence in the extended stay model. We helped create this company nearly twenty years ago, and believe our expertise puts us in a unique position to add long-term value," said Tyler Henritze, head of US acquisitions for Blackstone Real Estate.
The transaction has been unanimously approved by Extended Stay America’s board of directors.
The transaction is expected to complete in the second quarter of 2021.
They say it is the biggest pandemic era acquisition in the hospitality sector.
Extended Stay is a midprice chain which offers longer stay lodging with additional space and kitchen facilities.
It says it had a 74% occupancy rate last year, significantly more than the national average due to the pandemic.
"Corporate America is going to be a heavy investor in capital spending and this business is going to benefit from that," Henritze added.
