Hampton Inn & Suites to Play Larger Role in Future Hampton Brand Development

Business Wire, June 6, 2001

Business & Travel Editors

MEMPHIS, Tenn.--(BUSINESS WIRE)--June 6, 2001

Hampton(TM), the national brand of midpriced Hampton Inn(R) and Hampton Inn & Suites(R) hotels, today announced that its Hampton Inn & Suites product will play a larger role in future development of the overall brand, increasing to approximately half of Hampton's development pipeline in 2002.

Today, the Hampton Inn & Suites product accounts for about 10 percent of the Hampton brand portfolio of more than 1,000 hotels open.

Reflecting that trend, the 100th Hampton Inn & Suites hotel will open in June, as well as the brand's first new Hampton Inn & Suites hotel prototype.

"We have seen strong development interest in Hampton Inn & Suites with our new prototype, which has lowered the construction cost per key and reduced construction time," said Phil Cordell, senior vice president, brand management, Hampton.

"While we still expect to open around 80 Hampton hotels in total per year, we see the mix within our development portfolio starting to change. There are more Hampton Inn & Suites hotels in design than ever before. This means that in 2002, Hampton Inn & Suites could account for more than half of all Hampton hotel openings, up from less than one-quarter today."

The brand credits the surge in development of Hampton Inn & Suites hotels to its rising popularity with consumers, who repeatedly have ranked Hampton among the best hotels in the limited service segment, according to independent customer satisfaction surveys.

"Ever since we introduced the Hampton Inn & Suites model six years ago, with its unique blend of suites and standard rooms, the hotel product has become increasingly popular with guests and developers alike," said Cordell. "Consumer interest in Hampton hotels continues to grow, as evidenced by the overall brand's eight-point gain in market share last quarter; Hampton Inn & Suites' gain was about 50 percent above that.

"We feel this growth has been driven by market conditions that encourage business and leisure travelers to choose a product whose consistency and value they trust ... not to mention the flexibility of a suite option and the added benefit of our Hilton HHonors(R) frequent guest rewards program."

At least 30 percent of the guestrooms in Hampton Inn & Suites hotels are suites. The newly refined Hampton Inn & Suites prototype features a new "studio suite," which is expected to be well received by both business and leisure travelers.

Measuring approximately 375 square feet, studio suites include a microwave oven, refrigerator and sink, a spacious work surface with two chairs (one ergonomic), separate vanity and bath areas, and a sofa sleeper. Traditional guestrooms at a Hampton Inn & Suites hotel feature an expanded, ergonomic work surface as well.

Additional elements of the new prototype include an enhanced and more spacious lobby with two-story ceiling height, as well as an expanded breakfast area and pantry, gift shop, exercise room and a three-bay meeting room, capable of accommodating up to 50 people.

All Hampton guests receive free in-room movie channel service, free local phone calls made from the room and a free complimentary breakfast, which Hampton recently upgraded with popular brand-name food items and greater visual appeal.

"Since its introduction, Hampton Inn & Suites has continued to refine its concept to better meet the needs of both guests and developers," added Cordell. "Franchisees have responded very positively to the lower per-key construction costs and the product's proven satisfaction record among guests. Guests find that the hotel product better meets their needs, whether they are a family enjoying a long weekend or a business person with a need for additional space."

Cordell noted that nearly 50 percent of openings over the next year will be west of the Mississippi River. "Our primary focus remains on western region development. This year alone, we expect to open five Hampton Inns & Suites hotels in California, giving the brand significant additional visibility."

Traditional Hampton Inn hotels continue to grow at a rapid pace, with nearly 50 new hotels scheduled to open by the end of 2001. The brand also has a number of Hampton Inn and Hampton Inn & Suites hotels under construction in Mexico and Canada.

Hampton is part of Hilton Hotels Corp., recognized internationally as a pre-eminent hospitality company. The company develops, owns, manages or franchises approximately 1,900 hotels, resorts and vacation-ownership properties. Its portfolio includes many of the world's best-known and most highly regarded hotel brands, including Hilton, Conrad, Doubletree, Embassy Suites Hotels, Hampton Inn, Hampton Inn & Suites, Harrison Conference Centers, Hilton Garden Inn, Hilton Grand Vacations Company, Homewood Suites by Hilton and Red Lion Hotels & Inns.

This news release contains "forward-looking statements" within the meaning of federal securities law, including statements concerning business strategies and their intended results, and similar statements concerning anticipated future events and expectations that are not historical facts. The forward-looking statements in this news release are subject to numerous risks and uncertainties, including the effects of economic conditions; supply and demand changes for hotel rooms; competitive conditions in the lodging industry; relationships with clients and property owners; the impact of government regulations; and the availability of capital to finance growth, which could cause actual results to differ materially from those expressed in or implied by the statements herein.