Choice Hotels Acquires Suburban Franchise Systems; Acquisition Adds 67 Suburban Extended Stay Hotel Units; Nearly 9,000 Rooms Online To Choice System

"This acquisition allows Choice to enter a new segment, buildingon the excellent reputation and performance of the Suburban brand andthe expertise we have gained through our mid-scale extended stayMainStay Suites brand," said Charles A. Ledsinger, Jr., president andchief executive officer of Choice Hotels. "The economy extended-staysegment has strong supply-side potential and a solid track record forproviding above-average returns for hoteliers. Last year the segmentachieved an average occupancy percentage in the mid 70s compared to61% for the overall US hotel average."

He added, "As we combine Suburban's strong product and brand namewith our highly effective global marketing and reservations system, aswell as our focused extended stay services and technologyinfrastructure, we provide both existing Suburban owners and newdevelopers an opportunity for a very compelling return on investment."

The purchase price was approximately $10.5 million (consisting of$8.0 million in cash and approximately $2.5 million of liabilities)with up to an additional $5.0 million payable over the next threeyears, contingent upon meeting certain development targets. Thecompany said that the transaction is expected to add up to 2 cents todiluted earnings per share in 2006.

As part of the agreement, Kevin J. Lewis, president and chiefexecutive officer of Suburban Franchise Systems, will join Choice asvice president, extended stay, with responsibility for the MainStaySuites and Suburban brands.

"The Suburban franchisees, who also were the owners of thecompany, are excited about the opportunity to join Choice and to buildupon our success," said Lewis. "Working together, we believe we cantruly maximize the brand's outstanding potential."

With the completion of this acquisition, Suburban Extended StayHotels becomes the tenth brand in the Choice Hotels system.

Interviews with Choice executives are being coordinated by AnneMadison, vice president, communications, at Choice HotelsInternational. Contact: 443-463-3614 or Anne_Madison@choicehotels.com.

About Choice Hotels International

Choice Hotels International is one of the world's largest lodgingfranchisors, marketing more than 5,000 hotels open or underdevelopment in more than 40 countries under the Cambria Suites,Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn, MainStaySuites, Econo Lodge, Rodeway Inn and Suburban Extended Stay Hotelsbrand names. For more information on Choice, visit the company's website at www.choicehotels.com.

Certain matters discussed in this press release may constituteforward-looking statements within the meaning of the federalsecurities law. Such statements are based on management's beliefs,assumptions and expectations, which in turn are based on informationcurrently available to management. Actual performance and resultscould differ from those expressed in or contemplated by theforward-looking statements due to a number of risks, uncertainties andother factors, many of which are beyond Choice's ability to predict orcontrol. For further information on factors that could impact Choicethe statements contained therein, we refer you to the filings made byChoice with the Securities and Exchange Commission, including its form10-K for the period ended December 31, 2004.

Cambria Suites, Comfort Inn, Comfort Suites, Quality, Clarion,Sleep Inn, MainStay Suites, Econo Lodge, Rodeway Inn and SuburbanExtended Stay Hotels are registered trademarks, service marks andtrade names of Choice Hotels International, Inc., and itssubsidiaries.

(C)2005 Choice Hotels International, Inc. All rights reserved.