A Madison-based motel chain that built one of the city's first budget hotels has been sold, it was announced this week.
FFC Capital Corp. and Interstate Hotels & Resorts have created a joint venture to purchase the Exel Inn chain, consisting of 22 motels in six states.
Terms of the transaction were not disclosed, but all of the motels will be changed to various Wyndham Worldwide brands that include Howard Johnson, Baymont Inn & Suites, Days Inn and Travel Lodge.
The 100-room Exel Inn, 4202 East Towne Blvd., the first in the chain and built in 1972 by David Stauffacher, has been changed to a Baymont Inn & Suites.
"We look at the market and what product will be best suited for that market," said Peter Hoffman, vice president of operations for Interstate Hotels & Resorts, based in Arlington, Va. "The brands have specific requirements."
In some cases, as in Madison, some rooms will be converted to suites while other locations may have additions like continental breakfast and free wireless Internet access, Hoffman said.
FFC Capital is a privately held investment company, while Interstate Hotels & Resorts has ownership interests in 54 hotels and resorts and manages 218 properties.
Stauffacher, 72, said he was approached to sell the chain about two years ago and came to an agreement in September.
"I probably couldn't have timed this much better than I did," Stauffacher said of a pending recession. "Five or six months from the now, the environment may be a lot more difficult."
Stauffacher started the company with Terry Haller, the company's vice president. When the doors opened, the motel offered rooms for under $7 a night and was called Interstate Inn. The name was changed in 1974 after Stauffacher was unable to get a copyright on the red, white and blue Interstate logo, which is used by the federal government to mark Interstate highways.
At its peak in the 1980s, Exel had 30 properties. Revenues in the last year for the 22 properties, which employed about 800 people, were estimated by Stauffacher at about $17 million. The Exel Inns were among the first limited-service motels in Madison, which is now dominated by chains from large hotel operators.
"We had a great run through the 1970s. By the end of the '70s to early '80s, there was a lot of competition showing up," Stauffacher said. "Since then, there's been quite a proliferation in this segment."