The company, led by former Starbucks Corp. Chief Executive Officer Jim Donald, sold 28.25 million shares at $20 each, according to data compiled by Bloomberg, after offering them for $18 to $21. Charlotte, North Carolina-based Extended Stay, which was held equally by Blackstone Group LP, Centerbridge Partners LP and Paulson & Co., will use proceeds to pay debt, according to a regulatory filing. None of the firms sold shares.
Extended Stay, which owns and operates almost 700 hotels with about 76,000 rooms in the U.S. and Canada, went public three years after its owners bought the company out of bankruptcy and invested about $626 million of its cash flow in renovations that are close to completion. The investors are taking advantage of hotel stocks close to all-time highs and a rebound in room rates and occupancies to extend the busiest year for real estate IPOs since 2004, according to data compiled by Bloomberg.
Extended Stay sold paired common stock, comprising one share of the company and one Class B share of a related entity that is taxed as a real estate investment trust, the filing shows. Each paired share will trade as one unit, listed on the New York Stock Exchange under the ticker STAY.