La Quinta Releases Gold Medal Rooms Statistics And Impact Upon Third Quarter Revpar

Business Wire, Oct 2, 1996

SAN ANTONIO, Texas--(BUSINESS WIRE)--Oct. 2, 1996--La Quinta Inns, Inc. (NYSE:LQI) today announced that its unadjusted REVPAR (revenue per available room) for the third quarter of 1996 increased 3.0 percent over the comparable 1995 quarter.

"We are very pleased with this REVPAR increase considering the magnitude of Gold Medal(TM) rooms disruption we have experienced," stated Gary L. Mead, president and chief executive officer. "When reviewing statistics relating to the REVPAR effect of the Gold Medal rooms program, it is important to recognize that the impact is chainwide and not solely on the individual properties undergoing construction. Construction activities of this scale reduce occupancy and require significant management attention.

"We have also maintained relatively low levels of price increases in many markets in recognition of guest inconveniences. The disruption of occupancy, pricing and management time will largely end in the spring of 1997, approximately the same time as we begin aggressively marketing the completion of Gold Medal rooms.

"As we observed with the chainwide reimaging program which was completed in June 1994, the primary benefits occurred following the completion of the program. Interim statistics were not very indicative of the results to be achieved following completion," Mead continued.

At the end of September, La Quinta owned 237 inns (30,500 rooms), excluding the five new Inn & Suites, of which 107 inns (14,000 rooms) had completed construction related to the Gold Medal rooms program. The average change in REVPAR for these inns over the prior year for each of the periods is described below: -0-

Number                                                Average Change
of Inns                                                 in REVPAR
-------                                                 ---------
102       During Three Month Construction Period          (9.2%)
82        Following Completion - First Three Months        1.9
65                             - Second Three Months       2.3
29                             - Seven or More Months      8.4

The schedule to complete the program is as follows:

                                           Number Completed
                                           ----------------
                                           Inns       Rooms
                                           ----       -----
Through         September 30, 1996          107       14,000
Quarter Ended   December 31, 1996            22        3,000
Quarter Ended   March 31, 1997               59        8,000
Month Ended     April 30, 1997               19        2,000
                                           ----       ------
                                            207       27,000
Thereafter                                   30        3,500
                                           ----       ------
                                            237       30,500
                                           ====       ======

The REVPAR for the third quarter was impacted by these groups of
inns as follows:
                                                 Average Change
                                                    in REVPAR
                                                    ---------
Inns     - Construction Yet to Begin                    3.1%
         - During Three Month Construction Period      (5.9)
         - Following Completion - First Three Months    3.6
                                - Second Three Months   2.8
                                - Seven or More Months  2.8
Inn & Suites                                            0.3
                                                       -----
Weighted Average Increase in REVPAR                     3.0%
                                                       =====