Embassy Sets Record Development Pipeline in 2006

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. October 14, 2008

BEVERLY HILLS, CA, January 26, 2007. New Prototype Design, Innovation of New Products and Services and Renovation Strategy Sets Upscale Brand on Aggressive Growth Pace for 300 Hotels by 2010 In just one year since the Embassy Suites Design Option III prototype was launched at the ALIS Conference in Los Angeles, the Embassy Suites brand has set a record development pace with 25 new project approvals in 2006. Couple that figure with the implementation of the 20/10 Brand Enhancement Program, and Embassy Suites is a brand on a mission.

"With our latest prototype, we have opened up the Embassy Suites brand to developers who have believed building an Embassy was a challenge, due to the rising costs of real estate and construction," said Jim Holthouser, senior vice president, brand management, Embassy Suites Hotels. "With the prototype's flexible features and several new brand innovations, we are closing the gap between the costs to own and operate a full service hotel, versus a focused-service hotel."

Of the 25 approved hotel projects, 15 will feature elements of the Design Option III prototype, and will be located in urban, suburban and airport markets. Cities include: Valencia, CA, Indianapolis, Savannah, Atlanta-Kennesaw; suburban Atlanta (Sugarloaf); downtown New Orleans and Pensacola, Florida. The first Design Option III prototype is slated to open in Valencia, CA in late 2007.

Additionally, Mr. John Q. Hammons, a long-time Embassy Suites developer, has several hotels in design or under construction: East Peoria, Illinois; Omaha; Loveland, Colo.; San Marcos, Texas; Murfreesboro, Tenn. and Mooresville, NC.

Though the Design Option III prototype is scalable from 150-300 guest suites and resides on a smaller footprint than previous Embassy Suites prototypes, it still evokes the same Embassy Suites style and flair. Still present are the signature atrium with plants and a water element, Complimentary Cooked-to-Order Breakfast, a Nightly Manager's Reception* and spacious two-room suites.

"Hotel developers - both existing Embassy Suites franchisees and new ones, alike - have responded very favorably to this prototype," added Holthouser. "The new features and modifications to existing features reinforce our commitment to innovation and quality, not only to our consumers, but to our owners. We're very proud of this prototype and believe it will get us to our goal of approving 25 new hotel projects each year."

Vision for 20/10: Brand Innovation from Kiosks to Team Member Uniforms

With the 20/10 brand enhancement plan well underway at all hotels, the Embassy Suites brand is poised to remain a leader in the upscale hotel category. To date, the brand has successfully completed several phases of its 20/10 program, including the installation of new breakfast equipment and signage in all hotels, as well as standardizing 10 ingredients for the guest favored omelet.

Embassy Suites also set an industry milestone by becoming the first hotel brand to install self-service check-in kiosks at all hotels, with the additional capability of airline boarding pass printing to more than 20 airlines. Additionally, more than 75 percent of the brand's hotels feature the Embassy EssentialsTM upgraded bedding program.

In keeping with the menu of 20/10 enhancements the brand is undertaking, Embassy Suites is rolling out an exterior signage package to refresh its identity and position Embassy Suites as a brand of the 21st century. The colors in the signage will be updated from the burgundy of the 1980s to a more timeless color scheme of a metallic gold. Monument and pylon signs, as well as building signage, will prominently feature the signature green "E," building on the equity of the icon, along with the Embassy Suites name. The brand is also moving from traditional neon used in building signage, to the more energy efficient LED lighting.

"We've looked at this not only as a signage refresh, but also as a more energy-efficient way for our hotels to do business," said John Lee, vice president, brand marketing, for the Embassy Suites brand. "Some states give rebates to companies who are using more energy-efficient products, so many of our hotels can get a break that way. Beyond that, LED is easier to maintain, much more reliable than neon and virtually lasts forever."

By the end of March, more than 30,000 Embassy Suites team members will be stylishly outfitted in new uniforms designed by fashion design house Lafayette 148 New York. After a successful debut on NBC's "The Apprentice" in May of 2006, the Embassy Suites brand has teamed up with Cintas and Lafayette 148 New York to create Workstyle by Lafayette 148, a series of fashionable, yet functional uniforms for Embassy Suites team members. The brand is footing the bill for the program -- investing more than $3 million -- and providing two uniforms for each of its 30,000 team members.

In keeping with the trend of hotels featuring more upscale amenities for guests, Embassy Suites will introduce "Bloom," a new line of body care products that are sure to please guests and help them relax while traveling. Featured at Nordstrom and other specialty stores, the Bloom line features spa-grade products, such as shampoo, conditioner, lotion and bar soap and will be available in all hotels in 2007.

Renovation: At Nearly $600 Million in Renovations, Capital Improvements at Record Level With unprecedented levels of re-investment and renovation going on within the brand, Embassy Suites is poised to become a like-new brand once again.

"Since Embassy Suites is a 22-year-old concept, some of our hotels needed some attention," said Holthouser. "Our major ownership groups are spending nearly $600 million across the brand, but about 60 hotels -- nearly one-third of our hotels -- are undergoing major renovations. By the time these hotels have undergone these improvements, they will be just as up to par as our new hotels."

The upgrades are going beyond soft goods, with renovations and improvements focusing on repainting interiors and exteriors, modernizing HVAC systems, redoing public spaces, as well as the suites. The vast majority of renovations should be done by year-end 2007.

International Expansion of the Embassy Suites Brand

The debut of the Embassy Suites Hotel Mexico City-Reforma in November jump started the brand's plans to expand within Mexico and Latin America, as well as Canada.

"With the recent acquisition of Hilton International by Hilton Hotels Corporation, we are finalizing our plans to develop in Mexico and other parts of Latin America," added Holthouser. "We have seen tremendous interest in the brand, as there is a great need for upscale, all-suite hotels in those markets. The success of the Embassy Suites Hotels in Niagara Falls, Mexico City and Puerto Rico, showcases how the brand can work in international destinations, both from a leisure and a business travel perspective."

Expected to open later this year is the brand's second venture into Canada in downtown Montreal. The 216-suite hotel is located directly across from Montreal's convention center - the Palais des congr`es de Montr'eal.

In addition to the United States, Colombia, Venezuela and Mexico, Embassy Suites has hotels open in Niagara Falls, Ontario, Canada; Dorado del Mar, Puerto Rico; and Juan Dolio, Dominican Republic. The Embassy Suites Hotel El Parque-Miraflores, Lima, Peru, and the Embassy Suites Hotel, Valencia-Downtown, Venezuela are set to open in 2008.