Chalet Susse International was founded by Fred B. Roedel in 1968 with the purpose of providing consistent, affordable and quality hotel accommodations targeted for the northeastern business and leisure traveler. Motivated for tax and estate planning purposes, the controlling shareholders, represented by Steve Collins of Trefethen Capital Markets LLC, agreed to sell the company's assets to Olympus Real Estate Corporation in February 2000, consisting primarily of 27 Susse Chalet limited service hotels throughout New England and the Baltimore-area.

For Olympus, which had previously acquired more than $1 billion of upscale and upper-upscale hotels, this transaction represented its first foray into the limited service sector. The transaction, which closed after a protracted 18-month negotiation, was particularly challenged by the seller’s tax concerns and under-leveraged, non-prepayable debt. A creative and complex structure involving seller deferred compensation, among other things, was ultimately negotiated achieving both buyer and seller objectives.

For Olympus, this was a unique opportunity as it afforded three compelling characteristics. First, a substantial concentration of real estate in the region exhibiting the strongest supply-demand fundamentals in the country. Second, a reasonable cap rate on the under-performing portfolio that was achieving a modest 65% REVPAR index as compared to its competitors. And third, properties ideally suited for conversion to Fairfield Inn by Marriott, a brand which maintains a 114% REVPAR index nationwide.

Upon closing, Olympus negotiated a 20-property franchise agreement for conversion to Fairfield Inn creating a win-win situation for both parties. For Olympus, it affiliated the properties with one of the leading limited service brands in the country and for Marriott, it solidified its presence in New England increasing the Fairfield count in Massachusetts and Connecticut, alone, from one to nine properties. Olympus elected to partner with Paramount Hotel Group, led by David Simon (former Chairman and CEO of Prime Hospitality), to manage the portfolio and oversee the substantial property renovation and conversion program.

The first conversion from Susse Chalet to Fairfield Inn occurred in Milford, Connecticut on December 28, 2000. The remaining 19 properties will convert to Fairfield over the next six months after complete interior and exterior renovations. Of the remaining seven hotels in the original portfolio, two are in the process of being sold and five will convert to the Park Inn brand, a recent addition to the Carlson Worldwide hotel family. Since acquisition, Olympus has benefited from a portfolio-wide 13% REVPAR growth, despite the on-going renovations. Upon stabilization, Olympus is anticipating an approximate 50% REVPAR growth above current levels.