[2] Candlewood Suites Goes International With Hotel Development Agreement for Germany, Switzerland.

WICHITA, Kan.--(BUSINESS WIRE)--Dec. 7, 1999--

Midlantic Hotels Ltd. plans to open the first-ever Candlewood Suites outside the U.S. next year at Greifswalder Strasse and Erich Weinert Strasse in east central Berlin, not far from the historic Alexander Platz.

Candlewood Hotel Co. (Nasdaq:CNDL) has signed an agreement with Midlantic Hotels Ltd., Dublin, Ireland -- a closely held company owned by EBC Asset Management Ltd. of London -- for exclusive rights to develop Candlewood Suites in Germany and Switzerland.

The new Candlewood Suites will be one of the first hotels of its kind to be built in Europe.

"Even though the extended-stay concept is becoming more common in the U.S.," says Marc Finney, Midlantic Hotels managing director, "it is still fairly new in Europe. People who want `at home' features usually have to rent an apartment. Not only is that cumbersome to arrange, the quality varies and a traveler doesn't know what to count on. We expect all that to change with Candlewood Suites in the market.

"Business people around the world still need the same things, basically," Finney continues. "We wanted to align ourselves with a proven, quality hotel company that provides basic services in the mid-price category. That is why we chose Candlewood," he adds.

Midlantic expects its first Candlewood Suites to feature from 130 to 140 rooms. About 70 percent would be studio suites, and the remainder will be one-bedroom suites.

At Candlewood, every room is a suite with a complete kitchen, large business desk, two phone lines, 25-inch television, VCR and CD players. One-bedroom suites include a separate sleeping area with a second television and phone. Candlewood also provides an on-site, honor-based food and sundries pantry -- a mini-convenience store -- called the Candlewood Cupboard.

Features similar to those offered at no or low cost in the U.S. are expected to be offered in Germany, as well, including: -0-

--   free laundry facilities
--   free video and CD library
--   free "first night kit" with snacks and coffee
--   well-equipped exercise room
--   two phone lines and a dataport

Midlantic Hotels Ltd. is currently considering other possible sites in Stuttgart and Hamburg, Germany. The company plans to build five Candlewood Suites within a five-to-six-year period in Germany and Switzerland.

European Candlewood Suites key management will come to the U.S. for training at the company's Wichita headquarters.

"We believe the timing for this is perfect," says Candlewood president and chief operating officer Jim Roos, "and we are very pleased to partner with such a prestigious group to bring the Candlewood experience to European business travelers."

Candlewood Hotel Co. owns, operates and franchises 76 Candlewood Suites in the U.S., with others under construction. Candlewood targets mid-market business travelers and others on short-or long-term travel. Chairman and CEO Jack DeBoer, who also founded Residence Inn and co-founded Summerfield Suites in the 1970s and 1980s, founded Candlewood in 1995. He is recognized in the hotel industry as the creator of the extended-stay concept.

EBC Asset Management Ltd. is the London arm of the ERB Group of Winterthur, Switzerland. With annual revenues of CHF4.5 billion -- from 75 companies -- with 3,600 employees, the group has global reach in the real estate, automotive, manufacturing and coffee trading sectors.

The matters in this press release include "forward looking statements" within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are qualified by cautionary statements contained herein and in Candlewood Hotel Corporation filings with the Securities and Exchange Commission. Factors which may affect the Company's results include: the availability of financing on acceptable terms, the market acceptance of the Candlewood brand, the risk that signed agreements may not result in the construction or opening of hotels, construction, governmental or regulatory delays and general economic conditions.