Server: Microsoft-IIS/3.0 Date: Fri, 19 Dec 1997 02:18:53 GMT Content-Type: text/html Accept-Ranges: bytes Last-Modified: Thu, 06 Nov 1997 00:50:01 GMT Set-Cookie: EGSOFT_ID=128.2.209.145-1936242112.29166628; expires=Fri, 31-Dec-2010 00:00:00 GMT; path=/ Content-Length: 6519
The Company
BridgeStreet is a leading provider of flexible accommodation services in 16 metropolitan areas located in the Midwest and Mid-Atlantic regions of the United States. The Company offers high-quality, fully furnished apartments, townhouses, condominiums and to a lesser extent, houses (collectively, "accommodations"), primarily for individuals traveling on business and company executives relocating to new communities who require lodging for one week to several months. Together with the specialized amenities offered by the Company, these accommodations are intended to provide guests with a "home away from home." As of June 30, 1997, BridgeStreet had more than 2700 units under lease, and for the six months ended June 30, 1997, BridgeStreets average occupancy rate was approximately 90%.
As a provider of flexible accommodation services, BridgeStreet leases substantially all of its accommodations on a short-term basis from property managers, and then rents them to its clients. This enables the Company to (I) adjust the quantity, mix and location of its accommodations as client needs dictate and local economic conditions warrant, (ii) expand and enter new markets without the costs and lead times associated with investing in "bricks and mortar" and (iii) avoid the fixed costs associated with ownership or long-term leasing of real estate. The company also leases the furniture for its accommodations on a short-term basis from furniture rental companies. These furniture leasing arrangements enable BridgeStreet to maintain well-appointed, modern and attractive accommodations, upgrade and replace furniture as needed, and satisfy specific furnishings requests. BridgeStreets leasing strategy distinguishes it from fixed-location lodging providers, such as all-suite hotels and extended-stay hotels.
By providing flexible accommodation services, the Company can satisfy client requests for accommodations in a variety of locations and neighborhoods, as well as requests for accommodations of specific types and sizes. The substantial majority of the Companys accommodations are located within high-quality property complexes that typically feature, among other things, in-unit washers and dryers, dedicated parking and access to fitness facilities (including, in many cases, pools, saunas and tennis courts). In addition, at a quests request, BridgeStreet can upgrade an accommodation by providing specialized amenities such as office furniture, fax machines and computers. The Companys accommodations generally are priced competitively with all-suite and upscale extended-stay hotel rooms even though, on average, the Company believes its accommodations are substantially larger.
BridgeStreet was founded in August 1996, and in the first quarter of 1997 combined by merger five regional providers of flexible accommodation services. The Company has achieved significant growth in recent years. On a combined basis, units available for rent increased from 1,041 units on December 31, 1994 to 1,936 units on December 31, 1996, representing a compound annual growth rate of 41%.
The Company plans to achieve its goal of becoming a leading national provider of flexible accommodation serviced by implementing an aggressive acquisition program and a national operating strategy designed to increase internal revenue growth, cost efficiencies and profitability. Key elements of the Companys business strategy include:
Growth Through Acquisitions. The Company believes that the flexible accommodation services industry is highly fragmented, with over 400 geographically dispersed companies in the United States, few of which have more than a regional presence. BridgeStreet plans to take advantage of the fragmented nature of the industry by acquiring flexible accommodation service companies in major metropolitan areas frequented by business travelers. BridgeStreet intends to implement its business model at each acquired company as soon as practicable after the acquisition is completed.