Mar. 6, 2003 - Wyndham International Inc. is looking for ways to make its brand a household name. 

The Dallas-based company has pledged to add its flag to a dozen hotels this year. 

But when it comes to its extended stay hotel brand -- Summerfield Suites -- Wyndham is taking a more aggressive tack. Joe Champ, Wyndham's executive vice president of development and chief investment officer, wants the 38-property brand to grow to 90 in the next five years. 

But Wyndham, which already has $2.7 billion in debt on its books, must find developers willing to make the investment during uncertain economic times. It's hoping that its new Summerfield prototype will attract them. 

The new version of Summerfield costs less to build and has a more flexible room layout. 

And Wyndham is dangling several financial carrots this year in an effort to get several under construction or under contract by December. For those who sign on this year, Wyndham is offering technical assistance worth more than $100,000, waiving franchise fees -- which range from $30,000 to $50,000 -- and is discounting royalty fees. 

Even so, those incentives may not be enough to lure investors. Hotel financing has been difficult to find because lodging demand has been so soft, said Mark Skinner, a partner in hospitality consulting firm The Highland Group in Atlanta. 

"There' still a wait and see mode," he said. "Lenders are very reluctant to finance hotels." 

But extended hotels tend to stabilize more quickly than a full service hotel, which can take two to three years to reach even levels of business, Mr. Champ said. 

"Summerfield's can achieve a stable occupancy by the end of the first year," he said. 

Extended stay properties also have more stable business throughout the week than a business hotel, which typically empties on Saturdays and Sundays. 

Wyndham's new design can be adapted to use less than an acre of land -- versus the three- to five-acre plots required for earlier versions. That will be important as the company goes after new markets in urban areas. Extended stay hotels, have historically located in suburban and office park settings. 

The new version also allows more adaptability with room format to meet changing customer demand. Summerfield traditionally relied on business through its two-bedroom suites, which were popular in technology centers such as California and New Jersey. Companies used them as a less-expensive means to house employees undergoing lengthy training programs. But when the technology boom fizzled in 2001, so did much of that business. 

Summerfield also faces more competition from mid-priced extended stay brands, such as Extended Stay America and Addison-based Bradford Homesuites. Upscale brands such as Summerfield "are having to look for business in other areas," Mr. Skinner said. 

He said the one-bedroom and studio suite combination makes a property more competitive. 

"It enables you to compete better on a room to room basis," Mr. Skinner said. 

The extended stay hotel segment had explosive growth during the last several years, growing from fewer than 50,000 rooms in 1995 to more than 200,000 last year, according to Smith Travel Research. That growth has slowed during the last two years, but was still more than twice the growth pace for the industry overall. 

And more of Summerfield's customers -- 40 percent -- were staying less than five days, a stay more typical for a standard business hotel than extended stay hotels. 

The survey also found customers would be willing to choose a Summerfield more frequently if the price was closer to a traditional hotel -- a difficult feat for a one- or two-bedroom suite. 

By shifting two-bedroom suites into a one-bedroom suite and studio combination, Wyndham hopes to get closer to that price point. 

"This allows us the flexibility to adjust the rooms mix to maximize revenue," Mr. Champ said. 

Price competition has stiffened over the last few years as more extended stay brands have entered the market. 

The new design also makes building a Summerfield cheaper. Each room costs an average of $82,000, versus about $100,000 in the previous version. 

Even with that cost reduction, Summerfield is still as much as 8 percent more to build, but "our 15 to 35 percent revenue premium more than makes up for it," Mr. Champ said. 

In a sense, Summerfield's design is playing catch-up to changes its competitors have already made. But Wyndham officials say the new design surpasses the competition when it comes to design and hotel operation. 

Among its competitive set, Summerfield has been able to attract room revenue that is 15 percent to 35 percent higher, company officials said. 

Summerfield's 38 properties to Marriott International Inc.'s 430 Residence Inns and Hilton Hotels Corp.'s 122 Homewood Suites. 

"It's clear, looking at the growth of Residence Inn that the potential of a brand like this is huge," Mr. Champ said. 

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