IHG Acquires Candlewood

InterContinental Hotels Group today announced it was acquiring Candlewood Suites, a midprice extended stay brand with 108 properties in the United States. The move bolsters IHG's position in the fast-growing extended stay market, where it already has the upscale Staybridge Suites brand. According to Stevan Porter, IHG president of the Americas, the company intends to retain the brands' separate identities. The deal is expected to close in December, following approval by Candlewood shareholders.

In anticipation of today's announcement, industry sources had speculated that the acquisition would be a full-service brand to supplement IHG's Crowne Plaza. By acquiring a second extended stay brand, IHG is emulating the model established by Marriott International, which also has two brands in the category, the upscale Residence Inn and the midprice TownePlace Suites.

Extended stay bookings typically are for a minimum of five or seven days, though many bookings are for 90 days or longer. Hotel operators have found the extended stay model particularly profitable because the residential-style properties operate with minimal staffing and few service extras. IHG also has considerable experience in the midprice arena with its Holiday Inn and Holiday Inn Express brands.